Posted March 2020
As the coronavirus pandemic escalated, I was travelling around the world. The timing was unfortunate, but the endless hours of flying also presented an opportunity for reflecting on the virus.
Most people correctly focus on the immediate effects of the virus: survival is required for anything interesting in the future. However, many people will change their habits permanently and that excites the entrepreneur in me. Large changes create large opportunities.
It’s easy to see the direct impact of the virus. People stay at home, work remotely, and are paranoid about touching people and public surfaces. The second-order and higher order effects get more interesting.
Assuming we live in this timid new world of physical isolation, what will change?
Here’s my speculation, ignoring impacts of a potential recession.
Nutrition and health
Are the trends here to stay?
It’s December 2020 and the virus is finally under control, no worse than the flu has been historically. Quarantines forced us to go remote with everything but we could go back now. Which changes will stick?
The virus makes people switch from cinema to Netflix or any of its competitors. Streaming services are slightly worse on balance (some content is unavailable and the screen and audio are worse, but it costs less and is more convenient). Given this I expect box office numbers to return to perhaps 80% of pre-virus levels after self-quarantines are lifted, though if quarantines last too long, producers might start releasing films directly online, cutting out the cinemas.
Business travel will probably not return to pre-virus levels. The initial switch from physical to virtual meetings is costly due to the change in habits and investment in technology, and switching back would sacrifice convenience and speed. As for value, video is good enough for many meetings to skip the travel. Furthermore, I expect the video-meeting experience to improve through use case centric video call software: one-on-ones, small team meetings and 300-person all-hands meetings have all very different requirements.
Generally, stickiness of new solutions depends on two things: a) the value of the new vs old behaviour, and b) switching cost. It’s easy to see the two are distinct by simple home-ownership analogy. You might see a better house on the market but the transaction and moving costs would make you move only if the value difference is significant.
Thanks to Heiki Riesenkampf for productive discussions on this topic.
Taivo Pungas is Automation Lead at Veriff, where he leads AI product teams.
Previously, he built self-driving robot software at Starship, worked on software and data science at several startups, and has been writing for years.