April 2011This edition covers: • Revolution 2.0• The Rise of Social Entrepreneurship• The Future of Publishing• Smart Cities

DIGITAL/YOUTH DEMOGRAPHIC

REVOLUTION 2.0

A Unique Movement – in the Hands of Many➔ The sudden and rapid change that has recently swept across the Arab world has taken the world by surprise. Out of the blue, the status quo has been challenged and the long-held assumptions about the prerequisites for change have been replaced by mobile phones, an Internet connection and a Facebook account.➔ It is a unique movement because it does not have charismatic leaders – unlike the “velvet” revolution - as much as a common groundswell of opinion. It is revolution in the hands of many, rather than following in the wake of one.

Prerequisites for Change➔ For decades, Western governments and commentators did not think the conditions required for democratic change were present in the Arab world. Instead they saw inertia due to inflexibility of religious views, a growing materialism that only engaged the wealthy elites and the rise of activists whose militancy and radicalism only served to sabotage their own attempts to democratise.➔ Few foresaw the rise of a “Second Society” emerging: namely the “Arab Youth Movement.”

Demographic Surge➔ In the last 30 years, the number of Arabs has more than doubled, surging from 173 million in 1980 to 352.2 million in 2009. According to the UN, the total population of the Arab region is projected to reach 428.4 million by 2020. The majority of these are under the age of 24 and live in cities.

The “Youth Bulge”➔ This “youth bulge” is expected to increase to 73 million in 2015. This is important as some studies suggest that countries where young adults make up more than 40 per cent of the working age population are more likely to experience armed conflict than countries with lower proportions of youth.

The “Facebook Revolution”➔ The mushrooming of new universities across the region has created new spaces for youth to meet and mingle.➔ The wide and rapid spread of the information and communication technologies (ICT) in Arab countries has added another massive new space for gathering, networking and the exchange of ideas. Social media had a massive impact in mobilising people.➔ In Tunisia, once the authorities lifted the Facebook ban, it was quickly embraced by young Tunisians. At the time of the uprising over two million people, or 20% of the population, were on Facebook.➔ Shortly after Egyptian President Hosni Mubarak stepped down from power on Friday, activist Wael Ghonim credited Facebook with the success of the Egyptian people's uprising. Ghonim, a marketing manager for Google, played a key role in organizing the January 25 protest by reaching out to Egyptian youths on Facebook.

Changed Forever ➔ Today’s movement is different: its very

plurality could render it invulnerable to being hijacked by any particular interest group. It is the dawn of a new power base not only in the Arab world, but in the world as a whole.

ARAB YOUTH SURVEY 2011:➔The single greatest priority for young people in the Middle East remains living in a democratic country, according to the findings of the 2010 ASDA’A Burson-Marsteller Arab Youth Survey, the largest study of its kind of the region’s largest demographic. This finding echoes the results of the 2009 survey – conducted well over a year before the start of the recent regional unrest – which similarly identified the yearning for greater political participation as the defining characteristic of Arab youth.➔ This survey gives policy makers, business & political leaders, advertisers & the media compelling insights into the aspirations and priorities of the two-thirds of the region’s people who are under the age of 30. The 2010 ASDA’A Burson-Marsteller Arab Youth Survey is important reading for everyone who has a stake in the future of this diverse and rapidly evolving region.

WATCH: AN HISTORIC MOMENT IN THE ARAB WORLD: Wadah

Khanfar, Head of Al Jazeera on TED.com

http://bit.ly/gwBosN

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CORPORATE PURPOSE/CR

THE RISE OF SOCIAL ENTREPRENEURSHIP

A Certain Disenchantment with Charities is Leading to a Surge in Interest in Social Entrepreneurship

➔ Many of the larger charities are no longer as nimble or as risk-taking as they once were and are increasingly accepted as part of the very establishment they once set out to challenge. In the last decade alone, charity income in the UK more than doubled to nearly £50bn a year, giving rise to a small number of increasingly large operators . The 0.5% of charities with incomes above £10m now absorb more than 50% of all charity income. ➔ Growth has not necessarily been a bad thing. It has allowed many charities to offer help to millions more vulnerable people, and the growing importance of charities to deliver the government agenda has increased their influence on the way policy is shaped. However, the focus on getting the cash and delivering the contract has taken attention away from the person who should matter most to a charity, the beneficiary.

Two Real Threats➔ First, there is a problem of trust. Public trust in charities is high - only the armed forces, the NHS and schools are trusted more. But that trust is volatile: according to one survey, people's trust in charities has swung wildly from 51% down to 42%, and back up to 65% in just three years. Public alienation is a real risk.

➔ Secondly, as charities grow, the distance between the beneficiary and the management grows with it. Some charities manage to embed client-centred responsiveness within their structures; cf. RAPt and Mencap, where stakeholders are intrinsically involved. But for many charities, beneficiaries are passive recipients of services and their needs come a long way behind those of other stakeholders.

Up Steps Social Entrepreneurship➔ Many specialist social venture

intermediaries (SVIs) first emerged in the 1990s as interest grew in social enterprise and venturing. They include: new sources of finance (such as Impetus); new providers of skills (such as the School for Social Entrepreneurs); new orchestrators of networks (such as Ashoka); providers of buildings (such as the Hub); and advocates (such as the Social Enterprise Coalition).

Results-Oriented Approach ➔ SVIs are playing an increasingly vital role for

the emerging sector of social ventures. This survey found that ventures that had worked with intermediary organisations reported the following benefits: • 132 % increase in their numbers of beneficiaries (from an average of 1,251 to 2,901).• 149% increase in their revenues (from £338,618 to £844,850). • Around 50% reported that the intermediary they worked with had helped them raise additional investment.

8 TRENDS TO WATCH FOR in 2011http://dowser.org/eight-trends-in-social-entrepreneurship-to-watch-for-in-2011/1. More Creative Funding Solutions for

Social Entrepreneurs

2. Improvement of Metrics and Increased Adoption Rates

3. The Formation of an International Community of Social Entrepreneurs

4. Closing the Gap between For-profit and Nonprofit

5. The Democratization of the Movement

6. The Evolution of a Meta Profession

7. Growth of the Youth Constituency

8. More Product-Driven Ideas

READ: THE STELLAR RISE OF THE NEW PHILANTHROPIC INTERMEDIARYhttp://bit.ly/gHlVY9

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MARKETING/INNOVATION

THE DEATH & REBIRTH OF PUBLISHING

The Publishing Industry is Dead: True or False➔ Printed pages have been with us since

around 1450 A.D. After 561 years, you might think that people would be slow to accept innovation. However, the sale of an estimated 4 million Amazon Kindle e-readers has put paid to any such illusions.

➔ Barely into Q2, and 2011 has already been a rough year for traditional book retailers. In February, Borders filed for bankruptcy, saying that it would close about a third of its stores. And despite its major competitor being on the rocks, Barnes & Noble stock continues to drop.

Long Live Publishing – and Self Publishing➔ While retailers struggle and fold, there

might yet be new opportunities for publishers and authors alike. A publishing phoenix may still rise from the ashes.

➔ It was in July 2010 that ebooks started outselling hardcovers on Amazon . So it’s hardly surprising that publishing houses are moving to embrace the ebook more wholeheartedly.

➔ The economics of ebook publishing have already attracted new market entrants: publishers that specialize in ebooks for eReaders, tablets, and smart phones.

➔ These economics have not only inspired publishing houses to rethink their business model and new competition to take them on. It’s also created a new, independent breed of author.

The New Author➔ In January, 2010, the Huffington Post drew attention to Amanda Hocking, a 26 year-old self-publishing fiction author who has written 17 novels, published 8, and sold over 185,000 copies since April 2010 along. Hocking also topped the list of Kindle indie authors in December 2010, selling 100,000 copies in just one month.

Where Publishers Can Still ThriveOf course, the success of these new indie authors are constrained by two market realities. First, these authors are early adopters; the pioneers who will get to claim a disproportionate stake of the frontier. Second, the publishing houses are moving in. As they do, they will flood the market with more titles, meaning that any aspiring author will again rely on a big backer for the one thing they can’t do on their own: the marketing.Essentially, as the ebook market gets crowded, standing out in the crowd will be that much harder, and the value proposition that publishing houses will offer authors will be less about distribution and more about marketing & promotion.

What Next for Bookstores - Best Practice➔ Barnes & Noble has embraced e-book

technology. Anyone who buys the Barnes & Noble eReader, called the Nook, can take it into any Barnes & Noble, connect to the free Internet available and read any book in the store for free. This way, people are still enticed to go to the store, where they can lounge with their latte and book or Nook.

LEARN FROM THE DOMINO PROJECT➔ At the vanguard of the innovators

looking to transform and challenge publishing is one Seth Godin.

➔➔ The 50-year-old best-selling author, blogger and entrepreneur, recently announced that he would no longer sell his books via a mainstream publisher.

➔ The Domino Project aims to reinvent what it means to be a publisher: high quality ideas, created regardless of what bookstores & middlemen want. Packaged with cogency & urgency in mind. With permission at the heart of the model. Virality first. Reward the sneezers who stand up & spread these ideas. No patience for obsolete institutions. No compromise to get on bestseller lists. Triumph of speed. Format agnostic. Variety of price points & formats to match audience desires.

WATCH: Seth Godin on the Future Of Books, Bookstores, and Publishing http://bit.ly/hxGUl8

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TECHNOLOGY

SMART CITIES

What will population centres look like in 20 years' time? Innovations in transportation, energy production and technology will have to keep pace with a host of challenges.

➔ Demographers predict the planet will host 9bn people by 2050. Close to 60m new urban dwellers are added each year. The 21st

century will be dominated by the city.➔ Today’s cities can barely handle the burden of

their current populations: core services like energy, water, communications, transportation and public safety are wasteful, inefficient and decrepit. Even though cities only occupy 2% of the landmass of the Earth, they consume over 75% of the Earth’s resources. The only way to prevent rapid urbanization from being an environmental disaster is to operate cities in a brand new way: faster, smarter, cleaner.

The Smart Grid➔ The ultimate means to maximize efficiency

remains the most speculative and that is the use of information technology for ubiquitous awareness and intelligence. Even as prices rise for concrete, steel, oil, coal and water, one commodity gets steadily and inexorably cheaper: computing power. As sensors and microchips become smaller, less expensive and more powerful, they will be integrated not only into the power distribution system (the "smart grid") but into countless appliances, buildings, vehicles and public resources.

A city becomes “smart” when all parts of its infrastructure and government services are digitally connected and optimized.

➔ The smart city’s intelligent infrastructure is powered by three key technologies that share environment and citizen data constantly: sensors, the cloud and smart interfaces. Residents can also change the city experience, tailoring it to themselves by entering their preferences in touch screen smart applications. Adding such layers of intelligence to the bloated legacy systems of cities like New York, San Francisco and London will be slow and painful. However, new cities have no such constraints.

➔In South Korea, 40 km from Seoul, a new city is being built that promises to epitomize the smart city. Songdo offers residents green living in LEED certified buildings, smart homes with Telepresence monitors, a state of the art school, a park modelled on Central Park in Manhattan and a 15 minute ride to Incheon airport. And from there, less than a 3 hour flight to all major cities in Asia.

➔ Songdo is the first of a string of smart cities that are either in planning or development stage. Not to be left behind, existing cities in the US, Canada and Europe are all trying to quickly insert intelligence in pilot projects.

➔ Market demand for intelligence services for retrofitting cities and building new ones is estimated at trillions of dollars. And the fight to capture it is on: Microsoft, Cisco, IBM, Hewlett Packard, Siemens and Phillips, are just some of the big technology firms racing to get a piece of the action.

• Over the next 15 years, 600 cities will account for more than 60 percent of global GDP growth. How will regional patterns of growth differ? • With new hot spots emerging and household wealth surging in little-known urban centres, companies may have to adopt a much finer-grained approach to tap into the growth that lies ahead. • Opportunities galore for proactive technology companies.

SEE: McKinsey’s GLOBAL CITIES OF THE FUTURE, AN INTERACTIVE MAPhttp://bit.ly/hGiiWW

To request further information, give feedback or suggest a future topic for the newsletter, please contact:Elaine CameronStrategic Research & Trend Analysis, EMEA elaine.cameron@bm.com

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