Critical mass, Fermi Pile, pent up resources, and a turn in the economy

I am not an economist. I don’t claim to be able to predict what this quarters GDP, earnings reports, unemployment figures or durable goods sales are going to be. I don’t know if the economy is going to turn around in one month or 10 months. But I think I can say with some certainty, it has been bad (real bad) and all previous history seems to indicate that it will get better again.

I have a lot of friends, family and previous co-workers that are either unemployed or under-employed. I know even more people who, even if they are not happy with what they do for a living now, there is no way that they would risk leaving it to try something new.

All of this talent is waiting, like the legs of a swimmer on the starting blocks. This talent is just waiting for the starter’s gun to go off. The energy, collectively stored in this reservoir of talent is almost unimaginable, ready to explode as soon as the shot is fired.

There is another storehouse of resources growing at the same time: Social media and social networks. This collection of simple little services such as Facebook, Linked-in, Twitter, and Web 2.0 communities have been growing, gaining followers, working out the bugs, getting past the novelty and probably most important, adding users.

The downturn in the economy may have enabled and even fed these social networks. Millions of users have a bit more time on their hands, not as much free cash to go out, and a need to connect with friends. Oprah alone may have taken Twitter over the top when she featured it on her show. Twitter went from being this obscure service that almost no one used or understood to this misunderstood service that almost everyone was talking about, but still didn’t completely understand.

In the hay day of the Internet explosion (before it was known as the DotCom Boom), the power of a system came from the design of the system itself. Webservers, mail servers, databases; they all were judged against each other by their speed, their storage, their throughput, and their feature set. And although those metrics are still important, the users don’t care. Who cares if you can send only 140 characters at a time, if you are doing it any from device, at any time, from anyplace. Who cares if it takes 30 to 60 seconds for a tweet to get to its followers if they are splitting their time between their MP3 player and the other 5 things they are doing at the same time.

The power of the social network doesn’t come from the software. It comes from the users and the chaotic flow of information between them. It is no longer the software that is valuable; it is the shear quantity of users that make the system valuable.

Just like nuclear fuel is not explosive in small quantities or diluted form. A lump of unrefined uranium will not start a self sustained nuclear reaction because the molecules of fissionable material are too far apart, and not concentrated enough to have the neutrons that are flying off of them collide and interact with the other fissionable molecules. In 1942, Enrico Fermi and his fellow scientists were able concentrate uranium and bring it close enough in proximity to enable the first self-sustained nuclear reaction. As soon as it reached critical mass, the system was self sustaining and able to keep itself going.

Social networks have now reached that point. They have amassed enough users that they have momentum. It is harder for someone to dismiss them as a fad or an oddity. And at this point, businesses either needs to get with it, or get out of the way.

Some businesses and government agencies were slow to move onto the web, not understanding how it applied to them. Other businesses fumbled with the early web, awkward domain names, unwieldy URLs and confusing, awkward or just unusable web sites. But those early adopters figured it out. They realized that the internet was not only required for their business to succeed, but there were businesses that succeeded only on the Internet.

Social networks and social mediums and the foundation for the next wave of business/customer relationships. Business has always been about relationships and now those interactions have just found a new mechanism to expose them.