Interview with the BCB Communicator

Interview with the BCB Communicator
by William E. Halal
Wednesday, May 31, 2006

TechCast interviewed by VP Penny Omnès.
Penny Omnès, VP of External Affairs & Corporate Relations, interviewed Bill Halal to tell the story of TechCast. It's a fine analysis of the ins and outs of online technology forecasting, highlighting the unique features of the TechCast system.

Visionary Series An Interview with William Halal: Technology Forecasting. By Penny Omnès, Vice President, External Affairs & Corporate Relations, The BC Bearing Group

Not so long ago, we lived in a world without fax machines, personal computers, cell phones or digital cameras. We had never experienced virtual reality and had not been to cyberspace, a place that few of us had ever imagined back at the dawn of the 1990s. Fast forward to 2006. In today’s world, rapid change is a fact of life. Technological advances continue at an accelerated pace, dramatically impacting our daily lives.

With each succeeding wave of progress, the marketplace stirs, creating new opportunities as breakthrough technologies replace obsolete products and even entire industries with stunning innovations that change the way we work and the way we live. Now more than ever, the need to know the road ahead is critical. That’s why forward-looking organizations invest in gathering the best available knowledge about the foreseeable future. They turn to professional forecasters who track the progress of emerging technologies.

A rocket scientist who once worked on NASA’s Apollo Project, Dr. William Halal is a Professor of Science, Technology, and Innovation at George Washington University in Washington, DC. Halal is also President and CEO of Tech-Cast LLC, a virtual think tank comprised of a network of 100 experts from around the world.

The experts are recruited from business, academia, and government in the US, Canada, the UK, France, Spain, Germany, Norway, Finland, Israel, Mexico, Venezuela, and Taiwan. Experts are drawn from a diverse group of organizations including the US Department of Agriculture, US Environmental Protection Agency, NASA’s Langley Research Center, AOL, Sun Microsystems, Kimberly Clark Corporation, and Booz Allen Hamilton, among others.

TechCast (www.techcast.org) pools the judgment of this entire panel of experts to create a consensus on the Most Likely Year that a new technology will enter the mainstream.

Penny: Dr. Halal, you’ve obviously seen a lot of technological change in your distinguished career. How did you get involved in forecasting the future?

Halal: I have a technical background as an aerospace engineer who worked on the Apollo program. I was an Air Force officer, flying 130s and 141s. I’ve also worked in Silicon Valley. Around 1990, I noticed an unusual amount of activity in terms of technology advances. I began tracking the progress of various technologies and kept improving it every year. Originally, everything was conducted by mail, corresponding with the experts about 3-4 times every few years.

When the Internet became prominent, we moved it to the Web about seven years ago as the GW Forecast, which I developed with colleagues here at George Washington and at George Mason University in Virginia. Our website reached over one million hits a year and we worked with Corning, AOL, the US Government, the Asian Development Bank, and other organizations. In 2005, I formed an independent company, TechCast LLC, so that we could market our service more effectively.

Penny: What can you tell us about your methodology?

Halal: We use an improved version of the Delphi method, which the Rand Corporation invented about 40 years ago. We pool the best available background information and the collective knowledge of leading experts. TechCast is operated online in real time, so data inputs are constantly changing as new experts join the system, and as the other experts update their estimates. Our research staff redefines questions and we strive to improve the forecasts as we go along. We also gather forecasts from organizations like Gartner, Forrester, and IDC. And we summarize literature in the public domain.

On our website, there are extensive summaries of background information for every technology. I refer to this as a ‘Breakthrough Analysis.’ We do an enormous amount of work—scanning everything we can find and integrating this information into a very succinct summary of everything that’s known about each technology. Each summary is about 2-3 pages long. It’s a very valuable document, because it condenses what’s known into an extremely useful format. We track more than 50 technologies and we’re adding more all the time.

The summaries take the form of Data Points for each technology. Data Points highlight available information on the present adoption level of each technology, any forecasts that are available, estimates of economic demand, and other relevant facts.

Then we present Pros and Cons. Pros are trends driving a particular technology. Typically, Pros describe technical breakthroughs, business investment, examples of successful adoption, changes in government policy, statements by prominent authorities and that sort of thing. Cons are obstacles opposing the adoption of the technology. Cons can take the form of limited technical performance, high cost, and contentious political or social issues. This feature makes the document intellectually honest. We make a point of noting anything that’s an obstacle.

Penny: What would be a good example of a social obstacle?

Halal: I would point to things like the social acceptance of genetically modified organisms. In our forecasting, we note the fierce resistance the Europeans have had to genetic engineering over the years. We bring these kinds of factors to the experts’ attention. And then we provide the summary of the best forecast data. The experts look over all of this information and it brings them up to speed very quickly. I feel it greatly improves the quality of their estimates. After looking at that information, they integrate it all and use their judgment to give us the type of estimates we’re looking for.

Penny: So, how would you characterize these estimates of when we can expect certain technologies to enter the marketplace?

Halal: Strategic Breakthroughs are the most remarkable technologies that TechCast has studied. We think they have wide-reaching scientific implications, big commercial potential, great social interest, and are immediate enough to take seriously. In other words, they have the greatest strategic impact of the technologies now emerging. They are most likely to affect your organization and you personally in the near future.

Our results are automatically aggregated to forecast the Most Likely Year each breakthrough will occur, the potential economic demand, and the confidence level the experts have in their forecasts. We find this method to be very powerful. Generally, it can forecast any issue in any field with results accurate within plus or minus three years.

TechCast focuses on three major estimates. First, we ask when will this technology enter the mainstream, which we define generally as the 30% adoption level. Second, we ask what the market size will be, on a scale from 1 to 7. Third, we ask the experts how much confidence they have in their own forecasts, and we come up with a confidence rating. The experts’ role is crucial, because even with all that information and analysis, there is still ambiguity. The forecasts that you find in the public domain vary considerably, for instance. Our experts resolve that uncertainty with their forecasts. If the prevailing level of uncertainty is defined as 100%, I think this process reduces it to about 30%. Not perfect, but good enough to get decision-makers into the right ballpark.

Penny: What is your revenue model for TechCast, and how do you distribute your forecasts?

Halal: Results are automatically distributed over our website to corporations, governments, scientists, and the public. There are 3-4 sources of revenue that we think can provide value. All major organizations need technology forecasting, because they are all affected, very severely at times, by these technological changes. Our clients tend to be the strategic planning officers or product development people and general managers in various corporations and agencies.

We charge our individual clients a nominal subscription price of $950 a year. That’s far below what a Gartner or Forrester would charge. We’re looking at subscriptions to individuals and licensing a software package for large organizations. Then, there are places on the website where we can offer affinity ads for companies whose work is parallel to the things that are being discussed. Other organizations often want to license the site, because it is basically a learning system that they can use for their own purpose.

Penny: How does your information compare with the kind of forecasting large corporations conduct in-house?

Halal: The forecasts conducted by most organizations are costly and mediocre. It takes an enormous amount of work to do this well. It’s constant work over many years. I don’t think many corporations put that much effort into it. My experience, working with corporations as a consultant, is that they don’t have good forecasts. In a business environment, it costs millions of dollars a year to support a small team doing this.

We can offer reasonable rates be-cause we have graduate students who are prepared to work for modest sums. The point of TechCast is not primarily to make lots of money. This is fundamentally an academic research project. We simply want to do the research, and marketing our services provides us with revenue to support the project. To me, it’s a great source of satisfaction to create the first online forecasting system that operates in real time, like a stock market for technology.

We’ve just added three new technologies. One is ‘Cancer Cure,’ which focuses on cancer treatments using nanotechnology to identify and destroy cancer cells in the body. Another is ‘Thought Power.’ Fascinating studies are being conducted in which researchers place a skullcap on a test patient to read brainwaves. That allows the person to develop the capability to control objects with his thoughts, such as using a cursor on a PC or controlling a robot or a machine. The military is really into this. They envision the possibility that a fighter pilot could control the plane by just thinking—which would cut down his reaction time. Another key technology is the development of ‘Modular Homes.’ There is wonderful progress being made in constructing homes in small modules. The buyer can select any combination of modules, which can be assembled on-site very cheaply and quickly to produce any type of home that’s wanted.

Penny: In retrospect, what kind of technological advances have you predicted that we now use in our daily lives?

Halal: During the 15 years I’ve been doing this, we’ve had some very successful forecasts. We identified the prospect of alternative medicine early on, and it arrived about five years ago. I remember a wonderful article on the front page of the Washington Post that announced that visits to alternative medical practitioners matched conventional practitioner visits for the first time, so it’s now mainstream.

We saw a future in aquaculture. It made perfect sense, because consumers learned about 15 years ago that a diet of fish is far healthier than meat. That’s why the price of fish has skyrocketed. It used to be that you couldn’t give it away. Now, fish sells for $10 a pound because Americans know it’s healthy. That’s created huge demand. Aquaculture passed the 30% point a year or two ago. Broadband is another technology we forecast, as was the Internet. We didn’t know what it would be called or the exact form it would take, but we knew a global network of information-sharing services was coming.

Penny: Going forward, what do you see on the horizon?

Halal: Wireless is going to be very big, and it’s going to be fast. We’re talking about speeds like one gigabyte per second. It’s just remarkable. Wi-Fi is big now and Intel has put it on laptops. Right behind it is Wi-Max, which doesn’t have the distance limitations of Wi-Fi. You could cover an entire city with Wi-Max. And behind that is Ultra Wideband. Successive generations of these technologies are coming along just a year after each other.

Soon, about 2007, we won’t be limited to hot spots. Wireless technology is going to have a tremendous impact. Portability is going to become widespread. And the cell phone, or smart phone, is adding functions almost daily. You can get a phone with a small processor now that can do everything a computer does. And, of course, it has a camera and Internet access. I think the next big thing will be speech recognition, so we can overcome the limitations of the keypad. The smart phone will be the primary information and computing device for a lot of people.

Penny: So, what you’re saying is that the smart phone is going to take the place of the personal computer?

Halal: I don’t think the average consumer will bother with PCs. Some will use PCs for their work, but the smart phone will absorb many of the functions that ordinary consumers might use. The phone’s interface will improve, so you can just talk to it instead of using a keypad. The big manufacturers like Microsoft and IBM are saying that, by 2010, speech recognition technology will match the accuracy of human speech. I think that’s going to be an enormous breakthrough. No more keyboarding! Right now we are all limited by the present dumb interface with machines.

We are in for some big changes. Video is going to make a quite a difference, because we’ll have access to good quality video on our smart phones, so we can look at each other over the new voice/Internet protocols. The small 2-inch-by-2-inch screen on the smart phone will become a virtual display. There might be a small lens in your glasses that projects the image into one eyeball, so that you can have ordinary vision with the display superimposed over that. It will look like its 2-3 feet away. These kinds of heads-up displays are used in fighter jets, and by physicians, surgeons, and automobile technicians. Manufacturers are making them inexpensive enough so they can reach a wide public.

Penny: In this day and age, everyone is concerned about the future of our energy resources. What kind of changes can we expect?

Halal: We’re forecasting that alternative energy will grow from its present level of about 16% of total energy sources to 30% in about 2017 to 2020. Wind energy is one of the really important technologies. There are tens of thousands of big windmills going up around the world, especially in Europe and the US. There are biomass facilities that show it is possible to convert organic material like stalks of plants and waste from farms and fields into fuel that is less expensive than oil.

The big development will be when solar technology matches the cost of oil in about 5-10 years. Photovoltaic cells are going to become competitive when new plastic cells are perfected through the use of nanotechnology. These materials can convert sunlight into electricity more efficiently than the present silicon cells, and it’s going to be a lot cheaper.

Nuclear technology is also going to play a role for those communities that are prepared politically to accept it. The research shows that there are methods that can contain nuclear waste pretty effectively. It can be encased in glass safely for 100,000 years, and fast breeder reactors reduce waste by 95%. I think these will become sound ways to treat nuclear waste. But not everyone will accept that. It’s always going to remain a hot-button issue in some communities, but it’s on the table as part of our energy future.

Reprinted with permission from The BCB Communicator(2006) Vol. 12, Issue 1, a publication of BC Bearing Engineers Limited. www.bearings.com