by Robert Bryce
Jeff Sandefer is an Austin-based entrepreneur and founder of two schools, the Acton School of Business and Acton Academy. The latter, which is an elementary and middle school, relies on Khan Academy in the classroom. Sandefer predicts that within a few years, “every elementary-school math teacher in America will be out of a job.” While Sandefer may be overstating the case, the disruptive innovation now under way in the education business is unprecedented. Online education and MOOCs are catalyzing what may be the most important structural change in education since Jean-Baptiste de La Salle, a French cleric, began teaching teachers how to teach back in the seventeenth century.9 De La Salle’s heir apparent may be Salman Khan, a former hedge fund manager with two undergraduate degrees—in mathematics and electrical engineering—as well as a master’s in computer science, all from MIT. He also has an MBA from Harvard.10
In 2004, Khan, who was born in New Orleans in 1976 to a Bangladeshi father and an Indian mother, began tutoring his cousin in math by using an online sketchpad provided by Yahoo! His tutorials proved popular with other friends and relatives, so Khan began putting his lessons on YouTube.11 In 2006, Khan created Khan Academy, which is now supported by a variety of philanthropists, including the Bill & Melinda Gates Foundation.12 Today, Khan’s online school has more than 4,000 videos available on subjects ranging from geometry to art history. And the nonprofit isn’t shy about its intent. “We’re a not-for-profit with the goal of changing education for the better by providing a free world-class education for anyone anywhere.”13 That’s a stunning vision, one that clearly depends on its students having access to a computer with broadband connectivity and a reliable flow of electricity.
Khan believes that the use of video on the Internet can reinvent education, and that reinvention appears to be well under way. By the end of 2012, the school’s videos had been viewed more than 200 million times. Khan Academy is aiming to educate students all over the globe, with videos available in twenty-one different languages.14
The lower costs and ready availability of online courses have resulted in astounding growth. By 2013, more than five million students from around the world had registered for online classes.15 And while the early results are promising, plenty of questions remain about online learning. Chief among them: the issue of human interaction. What works for teaching math or science online may not be effective when the subject is literature or drama. The give-and-take classroom discussions that have long been lauded as essential to the Socratic method cannot yet be duplicated online. As one analyst put it, the instructors who teach online courses are “simultaneously the most and least accessible teachers in history.”16 For example, students who sign up for class work with Coursera have been warned not to e-mail the professor or attempt to “friend” the teacher on Facebook.
The business model for online education must also evolve. Khan Academy may be able to survive by relying on philanthropy. But other providers are going to have to find ways to generate revenue from students who are used to getting nearly all of their information from the World Wide Web at no charge. Some online education providers are trying to address that problem by charging a fee to take the final exam for certain courses. By paying the fee and passing the exam, the students are then awarded a certificate confirming that they have completed the coursework.
Students still need mentors and the challenge of the give-and-take conversation that can be fostered in the classroom by a skilled teacher. The future of education, as David Brooks wrote in a 2013 column for the New York Times, may lie in differentiating between technical and practical knowledge.17 Online courses are good at disseminating technical knowledge, such as how to solve quadratic equations or a given engineering problem. Face-to-face instruction is needed for learning more practical skills, such as how to negotiate a contract or argue a legal case.
MOOCs and online systems like Khan Academy are not a one-size-fits-all solution for education. But they are yet another indicator of how the Internet is reshaping our society and institutions. Clearly, online learning isn’t limited to Khan Academy or courses on integral calculus. Thanks to YouTube, interested learners can get free online schooling in a raft of subjects, ranging from how to fix a bicycle tire to how to play the Hendrix Chord (E7 sharp 9) on the guitar.
Our interconnectedness is fostering new methods of teaching and learning that are Faster Cheaper than ever before. And many of the same innovations that are reshaping education—Cheaper computing and Faster broadband connectivity—are also reshaping health care.
16
SMALLER FASTER CHEAPER MEDICINE
Dr. Leonard “Bones” McCoy, the fictional doctor on the Star Trek TV series, would be impressed with the Scanadu Scout.
To be sure, the device introduced by California-based Scanadu in 2013 isn’t as sophisticated as the fictional “tricorder” that McCoy used on Star Trek to instantly diagnose the maladies of his patients, but it nevertheless embodies the dramatic changes that are under way in medicine, a sector that is continually pushing for Smaller Faster Cheaper methods of doing business.
The Scout is about half the size of an iPhone. After being held on a patient’s forehead for a few seconds, it provides the patient’s body temperature, heart rate, blood oxygen level, respiratory rate, blood pressure, stress level, and even the electrical activity of the patient’s heart. (Tracking that activity is known as electrocardiography.)1 All of that data is then transmitted wirelessly from the Scout to the user’s smart phone.
The Scanadu Scout obviates the need for numerous other devices. There’s no need for a stethoscope to measure the patient’s heart rate and respiratory rate. We can get rid of the sphygmomanometer to measure blood pressure. There’s no need for a watch, thermometer, or electrocardiograph. Getting vital signs—a procedure that used to require a scheduled visit with a trained medical professional, who then needed several minutes to collect and record the data—can now be done with the Scanadu Scout almost anywhere, by anyone, in mere seconds. That data can then be shared with a nurse, physician, or maybe even a grandmother who’s worried about the health of her daughter’s baby.
Every day, in nearly every hospital in every country on the planet, medical professionals spend time collecting the vital signs of their patients. Thus, it’s easy to imagine the amount of time that could be saved with the Scanadu Scout. Because the Scout records the data digitally, it allows practitioners to keep more accurate records and to manage that data Faster than ever before. And, of course, Faster nearly always means Cheaper.
The Scout is just one of an abundance of new medical technologies that are transforming an industry. Smaller cameras and surgical devices have led to a surge in the use of less-invasive techniques like arthroscopy and endoscopy. Smaller sensors and Cheaper electronics are making some medical devices wearable. Some are even edible. Add those improvements to the dozens of breakthroughs that have occurred in medicine over the past century or so, a list that includes antibiotics, X-rays, magnetic resonance imaging (MRI), and computed axial tomography (CAT) scans, and the progress becomes clear.
In his 2012 book, The Creative Destruction of Medicine: How the Digital Revolution Will Create Better Health Care, Dr. Eric Topol, a cardiologist at the Scripps Clinic and a professor of genomics at the Scripps Research Institute, declares that “medicine is about to go through its biggest shakeup in history.” That shakeup, he says is due to “an unprecedented super-convergence” of digital technologies, including the “ubiquity of smart phones, bandwidth, pervasive connectivity, and social networking.” Topol’s book contains a graphic that excellently illustrates his point.
While Topol’s graphic contains most of the factors that are driving changes in medicine, he forgot one of the most remarkable developments of the Internet Age: the ability of entrepreneurs to raise money from people they don’t even know. And that takes us back to Scanadu. In May 2013, the company announced a campaign to raise $100,000 on the site Indiegogo to help fund development of the Scout. (Indiegogo is on
e of several crowd-funding operations. Kickstarter is another.) Within a few hours of posting its project on Indiegogo, Scanadu had met its $100,000 goal. By October 2013, it had raised $1.6 million.2
While it’s certainly true that the American health-care system is, in many cases, absurdly expensive and in desperate need of reform, it’s also true that many procedures have gotten dramatically Cheaper. For instance, between 1910 and 2012, the cost of an average X-ray has declined by about 80 percent.3 And unlike the clunky X-ray machines of yesteryear, patients and doctors can now use full-motion X-ray machines. Thanks to a Florida-based company called Digital Motion X-Ray, doctors can look at a patient’s hand, knee, spine, or other body part, and examine it as it moves. This technology gives doctors a better understanding of the area being examined.4
Physician/futurist Eric Topol foresees a future of “individualized medicine that is enabled by digitizing humans.” Source: The Creative Destruction of Medicine by Eric Topol. Reproduced with permission.
The first sequencing of the human genome was completed in 2003. It took nearly a decade and cost about $3 billion to accomplish that feat.5 But the costs to do the sequencing are falling dramatically. By 2012, the cost of sequencing a human genome had dropped to about $5,000.6 A commonly stated goal is to be able to do it for $1,000. The ability to have low-cost DNA information about a patient could allow doctors to quickly customize treatment plans based on the patient’s genetic makeup. And the time needed to sequence DNA is declining. A company called Ion Torrent is using semiconductors and ion spectroscopy so that it can now decode DNA in just two hours.7
Speaking of Cheaper, consider 23andMe. For $99, 23andMe will send you their “DNA spit kit,” which you can use to provide the company with a saliva sample. In four to six weeks, the company will send you a report on your genetic makeup, which includes details on your ancestry as well as info on your predisposition to a variety of possible health risks such as heart disease and breast cancer.*
Smaller Cheaper sensors could help us in the fight against diabetes. About nineteen million Americans have been diagnosed with the disease, and another seven million or so have diabetes but haven’t yet been diagnosed.8 For diabetics, maintaining the proper level of blood glucose can mean the difference between life and death. For years, the only way to monitor blood glucose was by pricking a finger and doing a blood assay, a messy and time-consuming process. But a new technology that relies on a tiny sensor implanted below the skin of the abdomen could make that messy procedure a thing of the past. The technology—continuous glucose monitoring—allows diabetics to use a small electronic device that wirelessly receives data from the implanted sensor. The device provides a readout of blood glucose levels and sounds an alarm if levels get too high or too low.9
Commonly used medical technologies now include an endoscopic capsule, a device equipped with its own light, battery, and camera, which transmits video images from inside the body. After being swallowed by a patient, the device can provide doctors with real-time images from inside the patient’s digestive tract.10 (As an example of how hot this sector is: in late 2013, Dublin-based health-care equipment company Covidien announced it would buy Given Imaging Ltd. for $860 million. The deal gives Covidien control over Given Imaging’s PillCam capsule endoscopy technology, which has been used more than two million times.)11 Or consider how dentists and surgeons are using scanners and 3-D printers. Dentists are already using those tools to quickly produce dental crowns. Surgeons are testing 3-D printers with the idea that they may be able to custom-print joints—knees are an early focus of their work—for their patients.12
The push to develop Faster Cheaper medical technologies comes not only from the desire to provide better patient care, but also to save money. In 2012, the United States spent more than $8,200 per capita on health care. That figure is more than twice as much as is spent by Western European countries such as France, Sweden, and the United Kingdom. For comparison, Australia spends less than $3,700 per person per year on health care. Nearly 18 percent of the US GDP—about $2.7 trillion per year—is now spent on health care.13 Add in the trillions of dollars being spent by other countries, and the size of the market becomes even more obvious. Furthermore, demographic trends point toward an aging population that will require more medical care in the years ahead.
Given those trends, the revolution that Topol envisions in The Creative Destruction of Medicine is dearly needed. Such a revolution won’t just be good for patients; it will also benefit medical professionals and the broader economy.
While the need for more effective tools like the Scanadu Scout and better medicines is obvious, we often overlook the fact that many of our most important medical devices and institutions rely on cheap abundant energy. Hospitals must be able to operate 24/7. And to provide the best medical care, they need super-reliable flows of electricity.
The next section discusses the urgent need for Cheaper energy.
* In November 2013, the Food and Drug Administration ordered 23andMe to stop selling its DNA test kits because the agency claimed the company did not have “marketing clearance.” For more, see: http://www.fda.gov/ICECI/EnforcementActions/WarningLetters/2013/ucm376296.htm.
PART III:
The Need for Cheaper Energy
17
THE FASTER THE (DRILL) BITS, THE CHEAPER THE ENERGY
When asked what he liked most about the new drill rig he was working on, Artie White had a quick reply: “They are so much safer than the old ones.”
White has spent much of his adult life working on drill rigs. As a roughneck, he worked countless hours on the main floor of drilling rigs in all kinds of weather—heat, cold, rain, snow. Heavy equipment was always overhead. The spinning drill pipe and numerous heavy tools on the deck meant there was near-constant danger of getting pinched or crushed. Despite constant attention, the drilling floor was nearly always slick. Drilling fluid that splattered off the drill pipe, as well as condensation and occasional rain, required workers on the rig to be continually aware of their footing.
But on a sunny, windy day in January 2013, White wasn’t swinging tools on the drill rig floor. There wasn’t a speck of dirt on his gray overalls. He wasn’t wearing a hard hat or safety glasses. Instead, White was drilling a well known as the Tom Horn 7–13–9 10H—located about 5 miles north of the old Route 66 in Canadian County, Oklahoma—while sitting in a climate-controlled booth in a comfortable chair. The well was one of dozens in the region that Oklahoma City–based Devon Energy was drilling in the Cana Woodford Shale, a huge formation of sedimentary rock about 13,000 feet below where White and I were standing.
No longer a roughneck, White, a native of Purcell, Oklahoma, had advanced to the position of driller. He was the foreman on the rig and was responsible for all of the activities on the drilling floor.1 Four workers, including two roughnecks, reported to him. To his right was a joystick similar to what you’d find in a video arcade. To his left, a bank of flat-screen monitors provided him with the rig’s critical information: the depth of the bit, the speed at which it was rotating, the weight of the drill pipe in the well, the flow rate of the drilling fluid (known as mud) that was being pumped into the bottom of the hole, and other data.
January 26, 2013: Artie White, the driller on Helmerich & Payne’s Flex-Rig 268, stands at his workstation while drilling a well known as the Tom Horn 7–13–9 10H. The outline of the drill pipe and drive mechanism can be seen behind him. The AC top-drive rig represents a major step forward in the safety and digitization of the drilling process. Source: Photo by author.
Controlling most of the drill rig’s critical functions with digital controllers means there are “a lot less ways to get hurt,” said White, who, as he talked, kept returning his eyes to the rotating drill pipe, which was about 15 feet north of him and could easily be seen through the thick glass window behind his workstation. It’s no surprise that safety is a prime concern for White. The people who work on drilling rigs have long had some of the har
dest and most dangerous jobs in America.2 The rig that White and his coworkers were using—Tulsa-based Helmerich & Payne’s FlexRig number 268—had all of the latest equipment, including a hulking apparatus on the deck of the rig called an “iron roughneck,” a robotic device that performs many of the more mundane—and dangerous—procedures that used to be done by humans.3
While safer working conditions are critical to every industry, the safety improvements on drill rigs are only part of the story. FlexRig number 268 is also a sixteen-story-tall example of the never-ending push for Smaller Faster Lighter Denser Cheaper in the Oil Patch. Silicon and software have replaced human interventions for the rig’s key functions. That allows the rig to drill more wells, Faster. Given that operating a land rig may cost $4,000 per hour, Faster drilling means Cheaper drilling.4
Over the past century, oil and gas drilling has gone from a business dominated by wildcatters armed with a hunch and a prayer to one that is more akin to the precision manufacturing that dominates aerospace and automobiles. Today, drillers like Artie White are so good at what they do that they can punch holes in the earth that are 2 miles deep, turn their drill bit 90 degrees, drill another 2 miles horizontally, and arrive within a few inches of their target.