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Tuesday, January 25, 2005

Digital Rules -Three Trends For 2005

Rich Karlgaard, writes brilliantly,Big trends have a way of sneaking past us. Consider the Web. In just ten years the Web has altered the way we grab information, manage our firms and organize our lives. China likely will surpass the U.S. this year in the number of Web surfers, a development few saw in 1995. Still, the day is young!..This year video Weblogs are sure to be the "it" thing. Excerpts with edits:

Technology products now enter the market differently from the past. It used to be that the coolest products (i.e., the most expensive) were those sold to businesses or to rich people who could afford them. Copiers, personal computers and cell phones entered the market that way. It would then take a few years for unit volume to kick up and prices to fall. Eventually the masses could afford to buy these products. But now the coolest products are being aimed at the masses from the get-go--iPods, DVDs and gigabyte memory sticks, not to mention terabytes of Google-accessible free content. Even software is following this trend. A generation ago the Sabre airline-seat yield management system, written for a few dozen carriers, was the neatest trick in the travel industry. Now it's Orbitz, aimed at billions of consumers. Google saves tens of millions of dollars by using cheap.consumer-class servers--more than 100,000 of them, actually--to power its search algorithm.

Another reason for a new golden age of small companies is that size and incumbency breed inertia, faster than ever even in the best of companies. Anybody who spent time on Microsoft's campus between the 1980s and the mid-1990s would find it a grayer place today. Though profitable as ever, Microsoft has warned it will slip to single-digit growth, and it no longer crackles with the same manic energy. Inside its fabled two-story white buildings there is much muted gossip about budgets and meetings and the like. Venture capitalist McNamee writes, "In the new normal, neither big businesses nor IPOs will get all the glory. Today, size matters less than at any other time in the past 50 years. Thanks to technology, even small businesses can have a global footprint if they leverage the Internet and available tools that are dropping in price even as capabilities increase."

Lastly, in one of those unintended consequences that governments create, Sarbanes-Oxley and the grand inquisitions of Eliot Spitzer are gifts to startups. Smaller companies can focus. Brain cycles in large public companies go to waste attending to compliance issues and other cover-your-rear work.

V-blogs, cheap technology ably performing business chores and a new golden era for startups- rich rewards await the entrepreneurs who knit these trends together.

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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
"All views expressed are my personal views are not related in any way to my employer"