A Conversation With Jack Plunkett, Market Research Publisher
A frequent public speaker and lecturer at industry events and on college campuses, Jack W. Plunkett is the CEO and publisher of Plunkett Research, Ltd., a company that provides industry information and market research in printed and, increasingly, electronic formats. A resident of Houston, Plunkett serves as an advisor to several corporations and non-profit institutions in and around the city. Here, Plunkett discusses why it's important that sustainability efforts quickly achieve operating efficiencies that make them literally self-sustaining, the costs associated with transforming yourself from a print-only publisher to one with digital products, and why access to fresh water is going to be the biggest single problem that we face this century.What do you say when people ask you, "What do you do?"
I say "I'm an analyst," which leaves most people with a totally blank look on their face. So I then continue to explain that I founded a firm, Plunkett Research, Ltd., more than 20 years ago with the goal of analyzing trends in business, technology, and demographics. We focus on explaining developments that will create the greatest changes within a business or technology sector over the midterm, five to 15 years. For example, we recently introduced a new Plunkett's Games, Apps & Social Media Industry Almanac, and we will soon release a major report on the green technology industry. Meanwhile, we write and publish large, annual versions of books on such fields as energy, infotech, biotech, and health care -- in total about 20,000 pages yearly. I love what I do because I get to learn constantly and interact with fascinating people in emerging fields. The fact that both globalization and technology have accelerated dramatically over the past couple of decades has made my work all the more demanding and interesting. Thanks to globalization, we have to study -- and sell to -- markets around the world, while the rapid adoption of digital media meant we had to develop ebooks and a serious Internet-based subscription system in addition to our printed volumes. Printed editions now account for less than 25 percent of our volume. In 1995 it was 100 percent.
It's also an immense intellectual challenge. We have become reasonably well known for explaining potentially difficult technical and financial trends in a manner that readers of most types can understand, even if they have no particular expertise in that domain. This means that my team and I have to understand, and be able to intelligently discuss, concepts like nanotechnology, globalization, or solar power -- not from a deeply technical perspective, but from a point-of-view that will be useful to a broad base of readers, including business professionals, investors, and graduate students. How will developing concepts change the world around us? How will consumers, governments and industries be affected? Which logistic, technological, or social challenges will result? Which investment and trade opportunities will arise? Our typical subscribers are schools of business and engineering at top universities, where students use our data for projects and case studies, as well as consultancies, government agencies involved in trade, investment firms, and business development people at major corporations.
What new idea or innovation is having the most significant impact on the sustainability world?
The idea that sustainability eventually has to be able to sustain itself. Thanks to the financial difficulties of governments in the developed world, and the challenges faced by financial backers since the Great Recession of 2008-09, there's a growing focus on backing long-term winners, rather than pursuing sustainability simply as a statement about how green and caring a corporation is, or how eco-sensitive a government agency might be. That is, renewables, recycling, and green efforts in general may need a donation from industry or an investment from government to help pay for research or initial development and installation, but eventually sustainability efforts have to achieve operating efficiencies or a return on cost that makes them literally self-sustaining. Over the long haul, the result will be that green technologies and efforts become a cost-effective, evolved way of living and doing business, rather than a bottomless financial pit looming beneath a well-intentioned hope. A lot of efforts are going to fail in this process, and a lot of consolidation is going to be forced. America has been rushing into a vast variety of renewable projects and backing a plethora of unproven technologies. Most of them simply won't work on a self-sustaining basis.
For example, two of America's giant, generously-funded solar-cell companies went bankrupt in recent weeks, including Evergreen Solar in Massachusetts, and Solyndra in California. Solyndra alone had received more than $500 million in federal loan guarantees and about $1 billion in private financing. Both had made faulty assumptions about global markets for the basic commodity, silicon, used in standard photovoltaic cells. As demand increased, silicon prices soared at first. But that high demand encouraged new suppliers to enter the market, and silicon prices collapsed to a level closer to historic norms. These two companies thought they had a competitive edge through new technologies that relied on less silicon. Meanwhile, competition from Chinese solar-cell makers forced market prices for solar equipment to plummet. The Chinese government has been supplying vast financial support, directly or indirectly, to their solar-cell manufacturers, including low-cost factory sites and loans. We do have some tremendously exciting new technologies in America that may achieve long-term success on a cost effective basis. For example, one of my favorites, a California firm called eSolar, has developed a concentrated solar power model that is relatively cheap, easy to install, and operates at high efficiency. They attracted General Electric as a backer in recent weeks. We have firms working on fantastic water conservation technologies in America, and brilliant battery and energy efficiency concepts based on nanotechnology. We need to find the best, most efficient technologies and move them ahead, relying on sound concepts rather than political influence or special interests.
What's something that most people just don't understand about your area of expertise?
People often remark to me that our company's costs must be much lower now that we deliver most of our published data electronically rather than in printed book form. Nothing could be further from the truth. Printing a book is a relatively simple, inexpensive process. Building and maintaining a subscribers-only website, with multiple servers, backups, relational databases, custom user tools, redundant power and Internet lines, along with the engineers and experts to keep it up to date is an immense cost.
What's an emerging trend that you think will shake up the sustainability world?
Over the next 20 to 30 years, the world is going to be blindsided by challenges and shortages in the area of sustainable water. Agriculture and industry are water hogs. Someone is going to make an immense fortune by solving or improving on this problem, while making the world a better place. There is vast opportunity to apply advanced technologies to improve this situation, including emerging technologies like remote wireless sensors to monitor conditions and water use in fields and factories. In fact, billions of remote wireless sensors, transmitting local data to computers where they will be analyzed by specialized software, will revolutionize many of the world's day-to-day processes. You'll hear people referring to these sensors as "smart dust." The price for such units will plummet to inconsequential amounts, while the emerging field of predictive analytics will utilize these new data sources to make the world more efficient and sustainable.
What's a sustainability trend that you wish would go away?
Placing organic and traditional farming over cultivation that takes advantage of advancing technologies. If you have enough income to be able to afford organic foods, that's fine. However, food cost inflation is now a major global problem. Several factors are in play here, including the conversion of vast amounts of food stocks into fuel for the first time in history; that is, corn and sugar cane into ethanol, thus increasing market demand and prices for basic foods.
By the end of this year or the early months of 2012, the global population is going to hit seven billion for the first time, and it will hit eight billion before 2025. Meanwhile, the middle class and its demand for calories will be soaring. This poses an immense challenge: how are we going to feed them? We're going to need the highest possible food output, particularly in basic grains. I realize some people will denounce me for saying this, but genetically-modified seeds, that is, agricultural biotechnology, are a large part of the answer. Nonetheless, misunderstanding and unreasonable rules are restricting their use. For example, in Africa, home to a soaring population, farms are prime for increased production, but European food import rules keep them from planting biotech seeds because many Europeans don't want to import any type of crop that has been planted anywhere near a biotech crop. How else are we going to feed Africa's soon-to-be bulging headcount? Genetically-modified seeds plus advanced farm technology are well proven ways to reduce the need for pesticides and herbicides, dramatically boost output per acre, improve resistance to drought, boost water conservation and improve the nutritional content of crops. China has already figured this out. It has tripled the yield per acre from its 71 million acres of rice over the past 50 years. Meanwhile, it is using genetically-modified rice developed at Huanzhong Agricultural University, and recently budgeted an additional $3.5 billion for research in this field.
What's an idea you became fascinated with but that ended up taking you off track?
When I was writing my 2011 book, The Next Boom, I started out focusing on the fact that America is one of very few economically advanced nations that has a rapidly growing population. The U.S. is going to hit 350 million people by 2025 and 400 million before 2050. This means that we will eventually have rapid new household formation and a large new pool of young workers, thanks to the maturing of Generation Y. This is a sharp contrast to rapidly aging and shrinking populations in much of Europe and in Japan. However, I branched out into a more global approach to what factors will launch the next significant era of global economic expansion, and what that expansion, or boom, will look like. What will be the most important technologies fueling future growth? I ended up focusing much of the book on the coming evolution in global health care, growth in global trade, the application of technology to improve education, along with improvements in areas like energy efficiency and water conservation. This is the first book that I've written that is truly designed for the mass market, and it was an interesting exercise to boil my concepts of how the world is changing into a short and hopefully entertaining book, instead of our usual 700-page business books.
I see an immense, global uptake of new technologies making the world more efficient, wealthier, better educated, healthier, and, at the same time, more sustainable. Let's take energy as an example. Everyone is writing about growing global energy demand, particularly in China, but almost no one is writing about our vast improvements in what is called "energy intensity." That is, how much total energy is consumed per unit of economic output or GDP. The progress here is incredible, and will continue to improve quickly on a global basis. For example, your refrigerator at home is a factor. Today's typical refrigerator uses about 75 percent less electricity than 40 years ago, despite the fact that it is significantly larger. Today's airliners use vastly less fuel per passenger-mile than they did in the 1970s. Better design, more efficient motors and engines, and better technology all are factors. Little steps like this add up to immense results. America's energy intensity has improved to the point that, by 2008, it took only 43 percent as much power to create a dollar of GDP as it did at the close of World War II, after discounting the effects of inflation. This phenomenon is occurring in much of the world. China, now the world's largest user of energy, has a stated goal for significant improvements in energy intensity in its current five-year plan.
Who are three people or organizations that you would put in a Hall of Fame for your field?
Steven Solomon, the incredibly talented writer behind the 2010 book Water: The Epic Struggle for Wealth, Power, and Civilization. Solomon started by detailing the way in which the availability and development of fresh water enabled civilization. Then he explained the enormous upcoming challenges posed by growing demand for, and limited supply of, fresh water. However, it isn't a doomsday book. He offers great hope for applying smart management and new technologies to alleviate the problem. I personally believe that fresh water is going to be the biggest single problem faced by the world in this century, and Solomon did a fantastic job of establishing a framework for discussion. He deserves a Pulitzer.
Next, I'd pick T.R. Reid, a Washington Post correspondent, for writing the 2009 book, The Healing of America. He is the only person who has managed to create a useful, understandable comparison of America's health care system with those of other major nations. He literally travelled to France, Germany, Japan, the U.K., Canada, and India, enrolling as a patient with local doctors (complaining of a legitimate problem with one shoulder) and getting personally entwined with the machinations, costs, and outcomes of various health systems.
Finally, I'd pick a fellow Texan, Robert Bryce, author of the 2010 book Power Hungry. Every situation can benefit greatly from a well-reasoned, persuasive skeptic, and he's the guy in the field of renewable energy. No one else is doing a good job of pointing out that things like traditional solar cells and wind turbines are so inefficient, especially in terms of 24/7 availability, that investing in them may not make any sense. He is brutally well-informed. For example, most people don't realize that when you hear that a new solar facility has enough output to power 100,000 homes, they are referring to peak output. That is, output during a typical four or five hours per day of intense, direct sunshine, assuming it isn't cloudy or raining. Where is the power supposed to come from the other 19 hours of the day? The challenges in fully realizing the potential of solar and wind power are immense. We aren't going to solve much in this arena until technologies improve, costs plummet thanks to economies of scale, and massive energy storage devices are developed. Meanwhile, Bryce offers his own vision of a path to sustainability.
What other field or occupation did you consider going into?
Everything. I've always suffered from being too interested in too many things. When I was a teenager, I thought I might enter science, but I've been a lifetime entrepreneur instead. Eventually, I found a great outlet for my interests and energy by analyzing and writing about technology, industry, and their effect on people.
What website or app most helps you do your job on a daily basis?
I love the World Factbook site, maintained by the U.S. Central Intelligence Agency. If I want to compare something like the median age and income of the Chinese population with that of Brazil, the answer is there. All types of social, economic, and industrial data are presented in a user-friendly fashion, for every nation in the world, without a fee.
What song's been stuck in your head lately?
"Raindrops Keep Fallin' on My Head," by B.J. Thomas, as wishful thinking. I live in Houston and keep a country place in the hills between here and Austin. The 2011 drought in Texas is of Biblical proportions. The immense wildfires near Austin over Labor Day weekend infused the sky with smoke and showered ash for miles around. My favorite local hiking spot, Bastrop State Park, burned to the ground. I'm looking for raindrops.