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Unio Capital is an asset management firm—oriented to publicly-traded equities, global in scope, and equipped to manage hedged and long-only portfolios as funds and separately-managed accounts.

In Perspective

Unio's "In Perspective" short-form series covers the Unio team's views on topics ranging from investing to business to economics.  

 

Expanding Horizons. Contracting Time.

John Allison

To expand or not expand?

Here is a very simple thought but one I have spent a lot of time pondering. And one that has big implications. The thought is: the Internet has expanded our horizons. But, because we spend more time on it, it has contracted our available time. The implication? Where do we go from here? More horizon-expansion, less time? Or more time, and less horizon-expansion? And if the latter, what do you get from limiting your horizon-expansion and getting more time?

The Internet has expanded our information reach incredibly. It never ceases to amaze me what we can do with the ecosystem it has created. In business. For personal use. Even 10 years ago what we do today with the Internet was inconceivable.

The power of what we can do.

For example, a friend asked me just yesterday how we managed to keep on top of all our investments. He knows we believe in rigor, depth, understanding. My answer boiled down to this: the tools we now have at our disposal allow a few people to  convert enormous amounts of information from across the globe into deep and actionable understanding whose value is all the greater because all the people involved can have an integrated view of all the understanding that’s being generated.

Likewise in personal life we now have ways to access information – things to read, places to eat & stay, goods to buy, friends to keep up with and so on that are essentially infinite in possibility. Plus, even outside of pre-fabricated environments like Facebook, we can set up our own website to feature our own book self-published on Amazon; or, set up a website as a central hub for a large family to keep up across the world.

The Implication Below: People are Spending Less Active Time on the Internet

 

Source: Forrestal Research. Annual Survey (since 1997) of Internet use. October 2012

Source: Forrestal Research. Annual Survey (since 1997) of Internet use. October 2012

Yet less Internet time.

So with the amazing wonder of the Internet at our disposal, why is the study in the chart above showing that people are spending less time on the Internet? Certainly more time than on other media. But less time on the Internet.

The Forrestal study behind the chart itself has flaws. One simple one is: since we are almost always plugged in all the time, how does one distinguish between active involvement and passive connection?

Nonetheless, there is abundant evidence, including  anecdotal  evidence, that more and more people are managing time spent on the Internet more carefully. That even includes kids – most of whom, when I ask the question are you spending more time on Facebook? answer less. And the reason? Facebook is becoming too much of an addictive time sink.

Crossing the time Rubicon.

Since time is a fixed human dimension, the reason I think people are pulling back is that they intuitively know when they are crossing a line where time spent looking on the Internet is cutting into time spent producing from the Internet (or from elsewhere for that matter).

One way of looking at the past 10 years of computing is that it has been overwhelmingly about getting people online – and using mobility to do the heavy lifting. Yes, there’s been a lot of Internet-as-productivity-tool either for the consumer (e.g. Amazon) or for business (e.g. Four Square). But using the Internet to enhance our power of producing – not just quantity but quality – has paled beside using the Internet to enhance our power of accessing – our power to connect, explore, and get informed.

Hence it is not surprising that companies whose devices, software and services have made accessing easier have prospered relative to companies whose devices, software and services support being more productive. Think Apple versus Microsoft. Think Facebook versus Workday.

Enriching time.

But the balance is shifting. In a world starved for growth, being more productive is no luxury. It is mandatory. Particularly in a world where assets of all kinds struggle to generate easy revenue and where leverage is less available or desirable as an easy means to make returns on assets rise.

Productivity – the power to produce more, or to produce higher quality with the same resources – can’t give us more time. But it can make the same amount of time we have go farther. And because of that power, my bet is that the next move on the Internet  – on the margin –will be to make time more valuable rather than horizons more expansive – although in absolute terms it will, of course,  do both.

— John A. Allison


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