I believe that we’re just at the beginning of a Third Industrial Revolution – and it has huge potential to increase prosperity and help our planet.

The first and second industrial revolutions brought about some of the most significant changes that humanity has ever seen. It has taken us from field dwelling apes at the mercy of nature to masters of not only our fate but that of the entire natural world. It has brought about unprecedented improvements in our quality of life and given us time to pursue a vast plethora of goals far beyond our basic needs. Great Britain helped pioneer this revolution leading the world from the agricultural era to the age of mass production, free markets and capitalism.

My view is that the second industrial revolution peaked in 2008 before the financial crisis. Economists now warn that we face another 20 years of declining productivity, slow growth, steep unemployment and increasing inequality. This economic downturn is fuelling growing discontent and spawning extremist political movements around the world. Furthermore, after 200 years of industrial activity scientists report that climate change is ravaging the planet, taking us to the sixth mass extinction event on earth.

Where do we go from here? My answer is the Third Industrial Revolution.

It has been argued at The World Economic Forum that these changed represent a fourth industrial revolution. Heres why I Disagree.

What is the Third Industrial Revolution?

The really exciting thing about this emerging economic paradigm is that it will bring about vast improvements in the efficiency of pretty well everything we do. Apparently, it will even change the way we think, act and feel, as different principles and values become the norm.

How I see it, there are three factors that define an industrial revolution, which are:

1. New communication technologies to manage economic activity;
2. New sources of energy to power economic activity;
3. New modes of transportation to move economic activity.

In the first industrial revolution, the key breakthroughs were long-distance communications using the telegraph, the discovery of abundant coal and the building of the railways. And for the second it was the telephone, radio, TV, cheap oil, centralised electricity, and the meteoric rise of internal combustion vehicles.

In the Third Industrial Revolution, it’s primarily about digitalisation – or at least that’s what’s enabling it to happen. Of course, it started with the communications internet, but that’s just beginning to converge with the renewable energy internet – and soon, with a GPS-guided, driverless transport and logistics internet too.

This is where the Internet of Things (IOT) comes in. Having devices and sensors embedded in almost any object means they can communicate, not only with each other but other internet users too. The result will be a smart digital society, which has up to the moment data on managing, powering and moving our lives.

Currently, there are 14 billion sensors working in a global network, but by 2030 it’s estimated there will be over 100 trillion. Wow. These are connecting all types of buildings, supply chains, vehicles and almost anything you can think of. This could include talking bins which tell you when they need emptying to aircraft components sending an alert when they need to be fixed or replaced.

DataThe key outcome from all this is gathering huge volumes of data – the more the better. Essentially, the only way to make sense of this data is by using Artificial Intelligence (AI), which will dramatically improve things like weather forecasts, health planning, transport logistics and much much more.

One of the most dramatic outcomes of this revolution will be that goods and services will be available at very little cost or even free. Welcome to the Age of Abundance.

This is already happening in Communication and Media, where once the upfront costs are paid for, there are minimal if any charges for ongoing use. For example, pre-internet, you would have to make a physical copy of a film on a DVD or VHS. Now, once you’ve paid the costs of making the film, you can distribute it to millions of people online at virtually no extra cost (zero marginal cost).

But, there’s some way to go before the Third Industrial Revolution really takes off. Driverless cars, the energy internet and 3D printing are no longer dreams, but there are many challenges to overcome before they really take off. I’m hoping to help solve some of the problems and come up with new ideas and solutions.

(In September 2018, I started my undergraduate course, on Management and Innovation, at Bristol University)

If you want to read more around this topic and find out where I got some of my information from, check out – Jeremy Rifkin: The Zero Marginal Cost Society

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