MARCH 5, 2009

Dynamic Recessions

Quick - name a major invention (or improvement on existing technology) from the 1930’s.

Having trouble? You’re not alone.  The 20s brought the radio and the perfection of airplane technology. The 40s brought atomic energy and the widespread adaption of the television, technically invented in the 30s but not commercialized until after WWII. But the 1930s have deservedly earned a reputation as lean years for innovation, a decade when Americans warily watched menacing overseas dictators and Humphrey Bogart movies, in anticipation of better times.

Compare that to today. It seems to be the consensus among economists that the current economic climate is as dire as it has been since the 1930s, and the evidence certainly seems to support that. But almost a year and a half into the “official” recession, and much further into the financial crisis, there seems to be no slowing of innovation, especially on the web.

Last year, for instance, I wrote about Pandora - an internet radio service that customizes stations based on your personal preferences. And at the time, the service was pretty state-of-the-art in the online music world. But even in the nine months since I wrote that post, someone’s beat it. Grooveshark has a Pandora-like interface, but allows you to choose whichever track you’d like to listen to next, whereas Pandora uses a predictive model to choose for you. Grooveshark has also written a very cool Twitter front-end for its service called Twisten.FM- which allows users to share songs via Twitter using the massive and ever-expanding Grooveshark library. Twisten.FM essentially allows you to broadcast your own personal radio station via Twitter to whoever would like to listen. With a staff of 40 people, Grooveshark is doing very disruptive and innovative things to two key emerging fields - media sharing and microblogging - and when you think about it, Twisten.FM essentially adds an entire new function to Twitter, without that company doing any more than providing developers open access to the service.

Innovation is also happening on a smaller scale. As side projects, individuals are putting together web services like Stumble Safely, an interactive map of NW DC that mashes up liquor license data, crime statistics, and Metro stop locations for those times you find yourself wandering around the District looking for somewhere to drink. Outside the software space, people are using open-source hardware kits like the Arduino to create useful interactive objects, some of which you can check out here.

I don’t mean to be a pollyanna about the current economic crisis, nor do I intend to sound like a technology utopian. It’s clear to me that significant problems exist in the financial sector, that those problems have spread to the “real” economy, and that smart and brave policymakers are needed to fix those problems. But as innovation - like the type I mentioned above - continues at breakneck speed, it’s hard to stay pessimistic about the economy for too long - a sentiment echoed by economist Jeffrey Sachs.

Time will tell whether innovation leads us out of this downturn, but for the moment, I’ll continue to blissfully ignore the news on CNBC.