Book Review: The Third Wave by Steve Case

Had such high hopes for this book by Steve Case (co-founder of America Online). For those of you not familiar with his premise:

  • The first wave applies to companies like AOL which lay the foundations for the internet
  • The second wave (which we are at the tail end of), is about companies like Google, Facebook and Snapchat that built search and apps and social media on the internet.
  • The third wave applies to a time we are currently entering where entrepreneurs will use the internet to solve major problems in healthcare, education, transportation etc. Third wave entrepreneurs will require massive amounts of governmental approvals. It will be more akin to the first wave than the second, because there will be more resistance to the disruptions than there was in the second wave.

Unfortunately, while the first half of the book provides great background and interesting details e.g. I didn’t realize that until 1992, it was illegal to connect a commercial service like AOL to the internet, the second half of the book is a real slog and incredibly boring.

From Chapter 8 on, Case is proselytizer-in-chief. There are way too many “I’s” dotting the page – basically he sounds like a bit of a narcissist – he’s so smart and if only people listened to him, none of these problems with AOL/Time Warner and so on would have happened. Dozens of paragraphs start like this:

  • I was hoping to enter into negotiations (p. 120)
  • I was reluctant to give up control (p. 121)
  • I understood enough about Jerry (p. 121)
  • I decided, before picking up the phone (p. 121)

Compared to Phil Knight’s highly touted recent memoir, Shoe Dog, about the start of Nike (which was riveting, humble and incredibly personal), The Third Wave comes up short on multiple levels.

Nevertheless, there are some interesting details to be gleaned from Third Wave:

  • One of AOL’s early users got his start in coding by hacking AIM. His name: Mark Zuckerberg.
  • America Online was named through an internal competition because there was no money for a branding firm. The leading choice had been Online America, Steve Case flipped it to America Online and it stuck.
  • Steve Case was born and raised in Hawaii and was a surfer as a kid. One of his business mantras comes from a fellow surfer: “When the wave is cresting, you’re either in the tube or you’re in the sand.
  • Nearly half of the top-ranked companies in the US will be gone by 2020 (Source: Global Center for Digital Business Transformation)
  • The idea of a self-driving vehicle was not first born in the tech sector; it was born in the agricultural sector. John Deere was developing GPS navigation systems for its tractors more than 20 years ago – before Google was even founded.
  • Many people have the power to stop an idea, but very few have the authority to green-light one. This creates an environment where there is a strong bias toward “no.”
  • The greatest challenge for successful companies is focusing on customers’ current preferences while preparing for their future preferences.
  • Some legacy companies have developed internal venture funds, in part to have an early-warning radar system for emerging ideas.

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