Mark Dean IBM

IBM's Mark Dean helped invent the PC, but he thinks its day is almost done: the PC being replaced in importance by the mobile phone.

Dean has been at IBM since 1980, and holds three of the company's nine patents on the original PC. Among other things, he led the team that developed the ISA bus, which was essential in hooking different pieces of hardware together.

Today, he's a fellow and vice president of technical strategy, based at IBM's Watson Research Center in New York. We had a chance to talk to him on the occasion of IBM's 100th birthday this month. Some highlights of our conversation:

  • He agrees with Steve Jobs that we're in a "post-PC world," but says that cell phones will have a much bigger impact than tablets like the iPad, and could eventually replace wallets, passports, and standalone cameras.
  • He thinks social networking tools are going to invade the enterprise.
  • He expects to see computer-generated "virtual characters" for movies and TV shows -- think realistic cartoons with artificial intelligence and their own personalities.
  • Mark Zuckerberg is wrong about privacy: people will always care about privacy, and will increasingly get turned off by targeted ads.

Here's an edited transcript of our conversation:

BUSINESS INSIDER: What have you been working on lately?

MARK DEAN: I'm responsible for the research strategy. Obviously you've seen the buzz around Watson. That was a great breakthrough by the team including Dave Ferrucci. I think that's going to really change the way we go about getting things done.

BI: Can you give me a couple practical applications where the technology used in Watson will actually show up in daily life?

MD: Computers are tools. So Watson is a very special tool that will, for example, allow a physician to make a better diagnosis and recommendation to a patient. Now the physician will be able to search through the history of diagnoses for similar conditions that this patient would have, and come out with some guidance on what worked, what didn't work, and the procedures that may be used for the best results on that condition.

Risk -- if many corporations are trying to evaluate the risk they take in an investment or a new business model, most decisions are made based on the experience that individuals have had. Watson can now give people insight into experiences that a corporation would have. And I can have that tool be available to a much larger number of people that need to make similar decisions.

You could have an "Ask Watson" service where people have their portfolios and want to get some guidance. You could say, "Ask Watson what you should do based on available information." Could be a service that a financial institution would provide.

BI: You helped invent the first PC for IBM. What do you think about the state of the PC market today?

MD: It's in a transition. The market's fairly saturated, I would say, in that the device of choice is changing. The device of choice in the world is moving from the PC to the handheld device. The cellphone, or the smartphone. The growth of this handheld device is much higher than the growth of the PC and the handheld device will be the device of choice for people to live their lives. To get their entertainment, to do their transactions. It will become the credit card, their driver's license, it will carry their pictures, it will be their camera. It will be their life. It'll hold all their medical records, contain all their homework.

The laptop will always be around, we'll always have PCs. Just like typewriters kept selling after we developed the PC. But as far as growth and how people will work and live, the handheld device will be the device that moves forward. We'll start to see PCs flatten out and maybe even start to decline in volume because of these new devices.

BI: Steve Jobs recently coined the phrase "post-PC" to describe the iPad. Do you believe that tablet computers like the iPad and the Xoom are essentially the same thing as PCs, or would you categorize them as a new market?

MD: The iPads and the tablets aren't going to have as much impact as the cellphone. For one reason, most of them, you can't make a phone call through. Just simple stuff.

The iPads are still too expensive for the growth market. People in India can't afford an iPad in the model it's sold on. They can afford a cellphone in the model that is sold on. The tablets are kind of a go-between from the PC to the cellphone.

I like the iPad. If you look back on my presentation 6 or 7 years ago, I always talked about the electronic newspaper, which is essentially what these iPads are. You're moving information to a point that's more interactive, but you're basically carrying around a device that allows you to read and access information.

But the iPad won't replace my driver's license. It won't be my passport. There's a lot of things it won't be.

BI: You really think that's where mobile phones are going? They'll be a replacement for documents, that kind of thing?

MD: Oh yeah. We will not have to carry a wallet in 5 to 7 years depending on where you live. Everything you have in your wallet will be on your cellphone. t'll be interesting to see what the world does around currency. Because you could easily start to imagine that currency would become all electronic, and that would be an interesting point in time. I think some countries will start to adopt that.

BI: Do you use a smartphone, and which one?

MD: I use a BlackBerry. Most of the people, I think, in IBM. We use BlackBerry.

BI: In 2004, IBM sold its PC business to Lenovo. What did you think of that?

MD: The generations before us, like my father, could start a career and end a career doing pretty much the same thing. Our business today won't allow you to do that. We're in a business where technology is driving advancements very rapidly.

It's to be expected that I would see in my career probably two or three significant changes in capability. I've actually seen more. But I fully imagine that I could start a technology, see it end, and have the opportunity to do it again. 

Security and privacy are great examples of where we're thinking ahead of the game. How do we integrate security and privacy in the deliver of capability to handheld devices such that they can essentially replace your wallet? How do you really do that? IBM is investing in these areas of security and privacy to actually make that possible.

BI: If you look around the consumer space these days, not just in emerging markets but in the US, what do you think is interesting? What's driving technology for the next 5 or 10 years?

MD:  IBM's contributions would be in delivery of evidence-based medicine. We've got a significant amount of breakthrough capability where we can actually pull together all types of information from x-rays to electrocardiograms to handwritten notes from doctors and bring all that information to bear in context to help doctors make decisions in future cases based on past cases.

Where you're talking about in the home, I would say we're making some great breakthroughs in delivering energy management, water management to the home. Essentially it's just bring to bear the information that already exists, but putting it in a context that is consumable by both the municipality as well as the individual homeowner. And helping them just make better decisions. That's more practical.

If you're looking for entertainment things, obviously IBM has processors that are in the three major game consoles. We build all the processing units in the game consoles. You'll start to see those consoles continue to add capability. 3D capability.

Computing capability has gotten to a point, and actually it's going to move in the next 3 to 5 years, to where you'll be able to create what we used to call a cartoon -- I guess a better term for it now is a virtual character -- here you can't tell that character from a real person on the screen. And in fact that character won't just be fed dialog, it will actually have its own personality. So you can imagine a whole movie that was created through characters that were all virtual, but you wouldn't know it. And in fact, you'll be able to create weather reporters, anchormen or women, you can start to imagine that. It's going to bring to bear some interesting discussion. Who owns that character or personality? Does that character sign a contract?

BI: There's a lot of buzz right now  about "social." Everything's social and Facebook is driving a million imitators in a million ways. What do you think about that? Any interesting trends there that IBM could capitalize on?

MD: With as much momentum as there is in social networking, it still hasn't infiltrated the enterprise. And one of the things that we're working on is the application of what we call "socially synergistic systems" to the enterprise. How can enterprise leverage social networking to improve its operational efficiency?

There's a lot of things I think will happen for the general public in social networking. The big issue there is managing privacy and security. I think that has yet to be solved. Fortunately most people are good and we haven't run into anything too bad, but we have to solve those issues before we get too much further.

BI: Mark Zuckerberg has said that privacy is no longer a social norm. He's cchanged his tune, but kids coming out of college now assume everything is public. Is that a social trend that's going to happen, or as people grow up are they going to want the same kind of privacy that everyone's always wanted?

MD: Funny thing about humans is that we're progressing but we're not progressing at the same rate that technology is progressing. I don't think our comfort level around privacy is going to change significantly. I was the same way when I was young. I thought, "Why not? People want to know about me? That's fine." I didn't have the same tools that we have now to engage, but as I remember it, it wasn't about privacy at all. You don't worry about it until you get to the point where you have something to lose.

Companies are going to have to be careful on how they use all this information as well. That will turn the trend in the opposite direction if we're not careful. If we do too much targeted advertising, for example, people get sick of that after a while. They can't filter.

BI: You mentioned social networking in the enterprise as sort of one growing trend\. What are some other big areas of opportunity in the enterprise that you see and that IBM sees?

MD: I think the one thing that enterprises have yet to master is the move to what I'd call data-based business. Most enterprises just collect data. They don't do much with it.  Helping an enterprise sift through all that information and find that nugget of pure value, like panning for gold, that will be the breakthrough.

We're talking doubling your revenues. Big changes in capability, a significant increase in amount of revenue and profit, just from the information that's already being gathered. You'll start to see companies measured not by revenues and profits, but by how much information their gathering. They'll be able to trade and engage in interactions through data as a for of currency.

It won't be the stuff like buying habits. I'm talking about data in how corporations run their business, efficiency data, optimizations -- all of that insight will have value.

BI: Of all the technology businesses and trends that have come and gone since you were at IBM, is there one you regret missing?

MD: No. We know most of them. Most of what we've chosen to do is not get into businesses. People might think IBM missed a business opportunity, but most of the time we made a conscious decision not to move into an area. We always detected a capability and felt that we could do it too early. That's my biggest challenge. I've been a couple years ahead of when the market can absorb a capability. It's usually not the technology that's the major element in something happen. It's the timing. Is it consumable? If not, people will have to wait.