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20 March 2018

SXSW 2018: 10 Themes (Not Trends) of the Season

Written by: Justin Westcott, General Manager at Edelman

Technology

Photo by Samantha Burkardt

Justin Westcott has just returned from SXSW. Here’s his take of the 10 recurrent themes from this year’s show.

  1. Trends, Trends, Trends

SXSW is synonymous with an onslaught of trend reports. But this season really took the biscuit, seemingly as every third presenter wanted to present their “trends”.  I’m not sure what that says about the state of the industry; seemingly everyone is searching for some signal in the noise. So in an absence of opinion we get trend spotters… it’s easy to be sceptical. Amy Webb bucked this trend, as she didn’t just give us a good trend report, but she gave us one of the best talks of the entire conference.

Her rigorous methodology for spotting key trends out of emerging technology is as robust as I’ve ever seen. In fact, Webb’s so confident in it her approach that she’s open sourced her methodology and even the results. Be warned, in the full report there are 235 trends for 2018.

  1. Fake News is a Business Model Problem

I’ve said for a while that platforms will struggle to adapt while they are slaves to Frankenstein business models, subsisting off clicks and advertising revenue. Apple reminded us that when it comes to fake news it’s a problem they don’t face. Why? It’s because they want to sell you devices, not advertising.

Apple’s Eddy Cue made the argument that curation is the answer, not algorithmically pushed content in support of advertising, as he lauded the work they’ve been doing with Apple News. Cue, using the platform to take a swipe at Facebook and Google, argued that if you have a ‘great platform you have a great responsibility’ to your audience to protect it.

I’ll be watching Apple News very closely to see how well it sticks to its core mission of providing quality content, in an easy format, while actively building in for serendipity and discovery.

  1. Bored of Blockchain?

Last year, we saw the explosion in value of cryptocurrencies and the ICO gold rush. The fringes gave birth to cryptocurrencies like Jesus Coin, Dentacoin and Bananacoin. (Yes, you can really buy and sell all these currencies.)

For me, what’s far more interesting is the underlying technology behind underpinning “crypto”. The MIT Labs session posited that these technologies should be viewed in line with standard internet protocols like Ethernet and TCP/IP – that once introduced then created huge companies and then wealth. These Blockchain protocols could become the next layer of the internet, allowing us to completely rearchitect the internet in the coming decades. This new ‘Web 3.0’ will move the focus to community-involvement and decentralisation so whether it will create the next Amazon, Facebook or Google is yet unclear.

We might be bored of the cryptocurrency-hype, but the revolution is only just getting started.

  1. The Splinternet Is Coming

The internet is unlike any past communications network. It is a software-based network that continually adapts and evolves. Ultimately, this means it cannot be regulated in the same way as static networks.

Nonetheless, politicians and lobbyists are trying their hardest to control the internet as if it was a static network. Increased polarisation, strong data regulation like GDPR, and net neutrality stances means we’re going to, in most likelihood, end up with many different versions of the internet.

The logical conclusion of this regulation will be the ‘splinternet’: multiple closed internets, curtailing the near global network we have today. With the Great Firewall of China, we already have one splinternet.

If we thought we had a fake news problem today, a splinternet future will take this to a whole new level.

  1. Will Tech Really Create the Jobs It Displaces?

Widescale automation is coming. We’ve known that for a while, and yet each year we’re coming up with more questions – and fewer answers. And I left SXSW with the feeling like a deadline for an answer is getting much closer (yet the work isn’t being done to address at the same speed).

Education is the real concern. How do we bridge the skills gap between both new and existing workforces? Tim O’Reilly argued that it is the responsibility of the tech industry to invest heavily in education, as ‘continuous education is the new part of the future’.

Amazon was keen to talk about it’s reskilling programme for existing staff, paying upfront 95% of tuition costs for its workers to learn new skills. Yet when asked by the head of the American Labor Union what it was doing about the fact jobs are going to fall off the cliff soon, and what all of the staff it displaces with it’s Amazon Go retail store will do – they said “this just isn’t something we’re thinking about”.

However, the risks are very real. Let’s be mindful that it took 60 years for employees’ wages to return to previous levels in the textile industry after the invention of the loom.

  1. Healthy by Default

What if the design of our cities actually made us healthier, and not sicker (as they do today)? This was the question posed to the ‘How Tech Can Refactor Modern Life’ panel which included Nicholas Chim, the lead of Alphabet’s Sidewalk Labs.

The panel were asked to offer suggestions on how cities can help nudge us to take more physical movement; improve the experience of commuting; and ensure better air quality.

Sidewalk are currently working with cities to help them understand patterns from their data and factor these into the design of the city. Recently, the team built a giant SimCity-like simulator in Toronto to test scenarios to better prepare mayors and city designers.

  1. AR and VR are still the next big thing, they’re just waiting for a killer app…

There’s no doubt that AR and VR technology is steadily getting better. Both technologies are attracting lots of development interest, but the use cases are still niche and not widely used. Most applications are either B2B focused or for gaming in the B2C space. And (good) VR is still dependent on expensive hardware, which is becoming ever more costly thanks to crypto-mining.

These reasons are why AR and VR are not quite ready to cross the chasm between early adopters and the mass market. Still, most attendees believe that we’ve now reached peak smartphone and that the next iteration will be some form of AR experience (powered by glasses, most likely).

  1. Experiential is the new 30’s TV advert

With the ad industry in crisis mode, and shrinking media titles, brands are now looking to events and experiences to deliver a return on investment. Earning broader and more meaningful content through attendees is the new media-buy.

No better was this demonstrated than by the Westworld activation, which you’ve no doubt heard about. Four months to build, for four days of activity – with the resulting excitement, conversation and social content achieving more than any media-buy at SXSW could achieve. Expect more and more brands to take this route. 

  1. Brands must have an opinion

Silence is now seen as an opinion. Throughout SXSW, there was much talk about the NRA, #MeToo, and brands that have taken a stand – on either side of the debate – and won as a result. This recognises that pleasing all, in a polarised world, is no longer an option.

Brands must take a stand. Your employees will respect you and customers of the same opinion will follow. Yes, in the short term you might lose some customers or fans, but in the long term you’ll gain more sustainable brand equity.

  1. Trust is the new gold

Almost every discussion came back to trust – whether we were talking about the big four, joblessness, fake news, AI, #MeToo, or the advertising industry.

Trust in the system is eroding, as we highlighted in the SXSW Trust Barometer. The switched-on, technologically savvy SXSW community are much less likely to trust specific technologies:

  • 27 percent trust in blockchain technology (22 percentage points less than global respondents)
  • 33 percent trust in self-driving vehicles (17 points less)
  • 33 percent trust virtual reality platforms (22 points less)
  • 35 percent trust the sharing economy businesses model (17 points less)
  • 37 percent trust the Internet of Things (26 points less)
  • 40 percent trust mobile/smart phone app developers (27 points less)

This is alarming. What does it mean if those that we consider to be ‘in the know’ do not trust the technologies which are poised to change our lives?

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