Seagate, the largest producer of hard drives recently announced that it had just shipped its’ one billionth hard drive.  In 1979 the company was an early trailblazer in the manufacturing of hard drives small enough for the early PC’s that were just being produced.  Their first product was the ST506 which held just 5MB of storage, was 5.5 inches wide and weighed 5 pounds.  This was revolutionary compared to the 14 inch and 8 inch drives that were standard at the time.  This first innovation of size reduction has, of course continued to this day.  A similar sized external hard drive today would hold not 5MB of storage, but 500 Gigabytes of storage, an increase of 100,000% in terms of capacity to weight and size.

What is even more revolutionary is the reduction in cost of hard drive storage.  The ST506 was priced at $1,500 for a cost of $300 per megabyte.  The most recent Seagate hard drive has 1TB (terabyte) of storage and cost just 1/50th of a cent, or $0,0002 per MB.  So the cost of storage has dropped so that 1TB today costs less than 5MB did 29 years ago. That is simply astounding. 

Seagate, in making its announcement of having sold one billion hard drives came up with some interesting statistics.  What the company has shipped already amounts to 79 million terabytes of storage.  That is enough for 158 billion hours of digital video or 1.2 trillion hours of MP3 songs.  The ST506 would have held just one song.  So, if you are reading this listening to music from your computer, praise this revolution of cost and size reduction.

Storage capacity will continue to dramatically grow as it will continue to cost less and shrink in physical size.  It has been projected that all the books published in a given year, currently some 175,000 titles, will fit on an iPod or more appropriately a Kindle sized device by 2015.  At that point we will no longer be talking about ebooks, we will be talking about elibraries that fit into ones’ pocket.

Much of the conversation in the world of technology and media is about the accelerating capacity of wireless broadband, of ever faster processor chips and the growing ability for all of us to access vast amounts of data with the touch of a finger or, increasingly the sound of our voice.  All of this is true but one of the underlying factors allowing us to live in this new media rich broadband world is the exponential expansion of capacity, reduction in size and cost of storage.

High speed Internet connectivity and mobility will allow us to change the way we live in the new world of expensive energy affecting commuting and travel.  Until we free ourselves from fossil fuels, this connectivity will serve as an essential lifestyle alternative for work, play and human interaction.   The ever lower cost and size of storage will allow us to dispense with the destruction of natural resources to create things, whose ‘thing-ness’ will be increasingly unnecessary in the digital world.  How many trees are killed every year for books, book shelves and all forms of paper products?  How much environmentally unsound plastic products are used for packaging DVDs and CDs?  

One of the unsung heroes of the digital technological transformation of the last 30 years has been the revolution in computer storage.  It is one of the parents of the long tail economy.

The other thing I remember were those times, while riding in the family car, of listening to the testing of the national alert system via the AM radio airwaves: “This has been a test of the emergency broadcast system”.  What examples of communicating to the populace; sirens that pierced the air of every population center in America and the then ubiquitous AM radio band.  The air raid siren being the industrial age amplification of the town crier and the AM radio being the most widely distributed form of electronic media at that time.

All this came back to me a couple of weeks ago when I read that the FCC had approved a plan for an emergency alert system that would send text messages to cell phones. This system is expected to be in place by 2010. Now that 75% or the population have cell phones and we carry them every where we go, what better way to inform us of a natural disaster or a terrorist attack?    The good news is that these text messages should be able to be geographically directed so if there is a tornado in Oklahoma on a specific path, those in the way can be sent text messages.  The only hope here is that with more than 1.5 billion text messages being sent daily in the U.S., this text message would not get lost in the clutter.

This evolution of warning system fits the times.  A nuclear attack would have been national in scope in the 1950s and 1960s, so a mass media national warning system made sense.  A terrorist attack or natural disaster will not be national in scope. 

So, the 50 year media history of the emergency alert system:  Air raid sirens and AM radio to text messaging. 

Last fall I wrote a column predicting that the trading range for the price of oil would be $80-125 for the next two years. I now want to revise that forecast. When I made that prediction, the price has recently crossed $80, charting new territory. While obviously not surprised, I did let all the disbelief I had been subjected to in my predictions to give me a sense of caution. Since $80 was the new high, and I was saying that it would be the price floor for the foreseeable future I thought it would be a correct floor. I did say in that column that there was little on the horizon to place downward pressure on $80 but much possibility in upward pressure on $125.

I now think that the core trading price range of oil for the next 18 months will be $95 – 135. I seriously doubt it will ever dip below the lower price, and if it does, it will be temporary. I do however think that that there are any number of scenarios that could provoke a rapid price run up to the $150 range. What if the price of oil was converted to Euros? What if rebels in Nigeria, or terrorists in Iraq seized control or disrupted the flow of oil through their pipelines? There is no excess global refining capacity today, and many of the refineries are old and in need of repair. What if several had to be shut down for periods of time? These scenarios are all what if, and may or may not happen.

What is reality is car ownership in China and India continuing to increase by millions of vehicles per year. What is reality is that electric cars, while starting to come on the market during the next three years, will not reach any significant share of the overall number of vehicles on the road until 2013-2015. Same for hydrogen cell cars and the compressed air car. There are scattered indications that gas consumption in the U.S. has declined slightly compared to 2007, but there has yet to be a discernable trend. Instead, there is developing research that shows that Americans, with the price of gas and food rapidly escalating are cutting back on all other things.

The long term price of oil will continue to go up for many of the reasons I sited in a column two months ago. It is entirely possible that prices in the range of $150 -200 a barrel over the next 4 years will occur. We are moving through peak oil now, meaning that we have somewhere between 30-75 years of petroleum left. There will be no large scale downward pressure on the price of oil until alternative energy sources approach 50% of total energy usage. Even then, the countries that have the largest remaining reserves will want to maintain price and not diminish the value of their remaining reserves by dropping the price. This is in no way pessimism at all, it is just reality.
Since I have been living with the expectation of triple digit oil for two years I get annoyed with this constant nightly breathless drumbeat of “oil reached another all-time high today” every night on the news. Yeah, get used to it. I feel like I am living a déjà vu life, there is no other way to describe it. When one fully expects something to happen and it does, it is not a surprise.

I do think that there is some bullish speculation in the oil marketplace, but it is not much more than a single digit percentage at best. The smartest thing to do is to accept and adapt to the fact that oil will remain at current or higher prices for the next few years. This will obviously affect the price of airline tickets and any other goods or services reliant upon oil directly or indirectly. We are a society that has been constructed actually and perceptually on the premise of inexpensive energy. That is no longer the case. We must all work for energy conservation and alternative sources of energy. We must develop an understanding that habits must change, governmental policies must change and fundamental changes in the workplace must occur. If we do not become proactive on these fronts, and soon, then expect disruptions to what has been referred to as “the American way of life”. The reality is leading the general perception of it, which at times feels ostrich like to me, and that puts the country at risk.

Petroleum will continue to rise in price as I have consistently predicted in this column.  We are most likely going through peak oil and when we accept responsibility for contributing to global warming we realize that all fossil fuels and the burning of them has incredibly dire unintended consequences.  In addition we are a debtor nation with a crumbling and in need of repair infrastructure.  Where is this leading us?

I have long been a fan of James Howard Kunstler’s book “The Long Emergency” and have recommended it to many people. [In addition his blog is one I recommend in conversation and have recommended on my links page since the inception of Evolution Shift.]  This best selling book details in a persuasive manner the coming deconstruction of American society due to the converging crises mentioned above.  Having read this non-fiction book from a novelist, it was no surprise to find that Kunstler was writing a novel about ‘post long emergency’ America.  It is called “World Made By Hand” and I have just finished reading it.

As the title implies, the post petroleum America has devolved into a landscape of local communities getting by through a return to the handmade world of the early 1800s.  The decline of oil production, the effects of global warming, the destruction of Washington D.C. and LA by terrorist nuclear bombs and large, deathly epidemics that swept through the population have reduced society to living locally, acting locally, no electricity, getting by with the social fabric always placed at risk by anarchic elements.  This picture of the future is made entirely plausible by Kunstler with a prose that is atmospheric and very humanistic. It is a beautifully written novel that creates the feeling of a town that remembers the past and is struggling to hold that memory with the present day reality of a much reduced way of life.

As a futurist, I am always looking at patterns, trends and forces to get a sense and vision of what lies ahead.  I do not think that the picture lyrically presented in “World Made By Hand” will occur.  I think that the ever increasing focus on and investment in alternative energy sources, the constant innovation of technological invention and the threats to human survival now looming to which we must respond, will all cause us to narrowly escape the future Kunstler paints in his novel.  That being said, there is a possibility that this picture could prove to be the correct one of the future.

The hope here is that this book gets a wide readership as it should be a cautionary tale as to what our continued lack of governmental leadership, complacency relative to conservation and energy, addiction to wasteful, destructive lifestyles and land use might let happen.  While the bucolic life described in the town of Union Grove in the book may be attractive to some, it is not one that most of us want forced upon us.  Reading this book points out how fragile our way of life might actually be if we continue to live it as we have.