Historically, the supply curve of utility services (electricity, public transport, water supply) has trailed the demand curve by a matter of several years (if not decades). From an economic standpoint, there is a clear alignment with the basic principles of micro-economics and the rules of supply and demand.
Why build excess capacity when there is no clear demand ?
But, for a moment let’s think about the excess build up of fiber connectivity and internet infrastructure before the bubble burst in 2000. Following the episode of gloom, the surplus of capacity across the globe helped initiate a wave of innovations that would not have been attempted without easy (and cheap) access to infrastructure.
I would argue that Web 2.0, voice over IP, peer-to-peer technologies, and more recently cloud computing wouldn’t have come about this rapidly.
So, the question that comes to mind is:
“what is the role of abundant infrastructure in the growth of innovative applications of a fundamental technology ?”
Clearly a complex question to address, but I will try nonetheless. To do justice to the topic, I will break this down into the following posts (as follow ups to this one):
1) what is infrastructure for innovation?
2) who is responsible for building infrastructure? (can companies do this?)
3) when do we end up in situations of excess/abundance ?
4) what are the tell signs?
5) role of Investors? (or investor community in general)
6) does excess infrastructure really help accelerate innovation?
If you specific questions in addition to these, please add your comments and I will try ton address them as well.
While I am not a planning or forecasting expert, this topic is close to my heart as a systems designer who thinks about systems at scale, and systems that have tremendously interconnected fates.