Jarold McWilliams <[email protected]> wrote: Things change. They're [oil companies] going to have to adapt, and if they > do, they can come out ahead. There is not much profit to be made for cold > fusion fuel, but they can produce the reactors instead. >
Oil companies have no expertise in manufacturing. Whereas there are thousands of established companies with experience in industrial manufacturing. Suggesting that oil companies should do this is a like suggesting they go into the fast food business, real estate, or housing construction. Or that McDonald's should try digging oil wells. Maybe they can take a large part of the transportation sector with cold > fusion as the power source. > Maybe they can, but the transportation sector already has dozens of large companies that can do this far better than an oil company could. IBM could probably manufacture an automobile, but you can be sure that Ford or Toyota can do a better job. Also, you are overlooking the fact that this will be a game of musical chairs. 99.9% of the dollar value of the energy sector will vanish in a generation. Oil companies, electric power companies and many others will lose all of their business, the way railroads lost their passenger traffic to automobiles and then airplanes. They will all be casting about desperately for some other line of work, and for some place to put their human and financial capital. Jobs for people who are good at drilling deep holes in the ground or transporting millions of tons of liquid in supertankers or pipes will have a large crowd of unemployed people and corporations vying for the contract. Perhaps there will be new uses for holes drilled in the ground, or new reasons to move megatons of toxic liquids around. I doubt it, but there might be. (Any number of companies can move water around, so the desalination business will be swamped.) In my book, I suggested that Exxon may be reborn as a company that terraforms Mars. It has already inadvertently terraformed the Earth, and not in a good way. Yes, it will take a lot of restructuring, but if they are smart about it, > they will prosper more than they ever have. > I doubt they will. Looking at the history of commerce, in nearly every case when a technology become obsolete, the leading corporations in that technology did not adapt. They did not prosper. They went out of business. This was true even when they might have easily used the new technology. For example, companies that constructed sailing ships began using steel and other modern materials as the 19th century progressed, and they had a great deal of expertise in marine technology. They might have easily adapted to making steamships. But none of them did. They all went bankrupt. In another example, the Baldwin Locomotive Company and other who manufactured steam locomotives might have easily transitioned to Diesel locomotives. Much of their expertise in things like wheels, lubrication, brakes, controls and so on was directly applicable. But none of them did, as far as I know. For other examples, see the various books and studies by Christensen (Harvard Bus. School) Exxon will be in a much worse position to transition than Baldwin was, since they have absolutely no experience doing anything similar to manufacturing reactors. The Singer Sewing machine company tried to get into the computer business in the 1970s. They, at least, had experience with precision manufacturing. They failed. Other companies that failed in the computer business in the 1960s and 70s include GE, RCA and Xerox. They had deep expertise in electronics, but they could not compete with IBM and the others already established. See: R. L. Glass, "Computing Catastrophes" (1983). - Jed
