I'm not sure. Still searching for the answer.
Adam
http://www.forbes.com/karlgaard/
TEN LAWS OF INFINITE AND ZERO
by Rich Karlgaard, Forbes
The Dow passes 10,000 [heck, 11,000 -- AR] and grabs the headlines. A
bigger benchmark waits in the wings. This year, the retail price of one
mip (millions of instructions per second) of computer performance will
drop below a dollar. Ten years ago, a single computer mip cost $500.
Twenty years ago, a quarter of a million bucks. Thirty years ago-well,
NASA's elite Ames Research Center, supported by the Department of
Defense, could barely assemble one measly mip of computer power. Ten
years hence, you'll buy that same mip for a fifth of a cent. Also going
down the price escalator is bandwidth. The last issue of Forbes told how
Global Crossing plans to turn a profit selling a transatlantic phone
call for one cent a minute. That's with today's gigabit fiber optics.
But early next decade, Global Crossing (or its slayer) could sell a
terabit fiber-optic connection for a penny an hour.
The technologies of chips and fiber are racing toward infinite
capabilities at zero cost. Do they ever reach absolute infinity and
zero? Obviously not. But if you round them off, they do. That's why
smart entrepreneurs are even today launching enterprises and crafting
business models around the new world of infinite and zero. What does a
new ecology shaped by infinite and zero look like? Ten principles stand
out:
1. SMART DEVICES WILL PROLIFERATE LIKE RABBITS.
Today there are 400 million PCs and perhaps a billion telephones in the
world. Ten years from now, assume there will be 1 billion PCs, another
billion high-definition TVs and 3 billion telephones. Just as with your
computer, the new TVs and phones will be all-digital and have Internet
addresses.
2. SMART CHIPS IN EVERYDAY THINGS WILL SPREAD EVEN FASTER.
Soda machines, gas tanks-even, perhaps, your toilet-will have smart
chips with Internet addresses. (Yes, your toilet. Someday it might
e-mail your doctor, warning that your PSA [prostate specific antigen]
count is too high, thus saving you from an early prostate cancer death.)
3. THE EXPLOSION OF SMART, CONNECTED DEVICES WILL CREATE A GLOBAL MARKET
OF INSTANT AND NEAR-PERFECT INFORMATION.
About what? About anything a global market wants to know-the price of
goods and services, the status of inventories and shipments, the
availability of capital and talent-anything.
4. TRANSACTION COSTS WILL CONTINUE TO DROP.
The price of a stock trade, now $9.99 at Datek, is only one stunning
example.
5. SPOT- AND AUCTION-PRICING WILL GO MAINSTREAM.
It's already hit the airline business and will soon transform telecom
and energy. Soon, even, a can of soda: On the 15th hole of a golf course
in July, with heat waves bouncing off the sand trap and your mouth
parched, you'll slip a smart card into the pop machine and discover a
can costs a fortune-$3.87! The pop machine isn't stupid! However, that
same soda may go for 44 cents on a frigid day in February. Most people
hate to haggle, you protest. So what? Let your smart card and the pop
machine duke it out.
6. ONLY THE BEST OF BREED WILL CUT IT IN THE AGE OF INFINITE AND ZERO.
Every big company hides a dirty secret: Some of its products are
overpriced dogs. Until now, a company could camouflage a dog behind its
good products and a strong brand. Sorry, that game's over; dogs won't
fly in a world of perfect information.
7. VERTICAL INTEGRATION IS KAPUT.
The computer industry, vertical in the 1970s, is now a series of layers:
microprocessors (Intel); operating systems (Microsoft); apps (Microsoft,
Lotus, Intuit and thousands more); box makers (Compaq, Dell, IBM);
memory chips (Intel, IBM); resellers (MicroAge, CompUSA); and
integrators (Andersen, EDS, IBM). Currently spinning apart are telecom
and financial services. Tomorrow: gas and electric power, government.
8. MIDDLEMEN WILL THRIVE!
The new-breed intermediaries will harness the power of chips, bandwidth,
software and the Web. Priceline.com is the exemplar of a new
intermediary. Guy Kawasaki's Garage.com (disclosure: I sit on its board)
uses the Web to hook up technology startups in Minnesota with angel
investors in Silicon Valley.
9. CONSUMER POWER WILL RISE UP.
If 1,000 prospective buyers of Toyota Camrys knew of one another's
existence, they'd have enormous potential clout. The Web makes this
easy. Look for a boom in team buying and cyber-fleet sales.
10. BRAND AND SERVICE WILL NOT PROTECT COMPANIES FROM RUDE, DISRUPTIVE
CHANGE.
That old suit of armor continues to have value. But brand and service
will not stop cyber-bullets. Amazon yanked the top brand away from
Barnes & Noble in a heartbeat. As for services, a new generation of
easy-connection software like Sun Microsystem's Jini might wipe out
low-end systems integrators in a blink.
----
adam@cs.caltech.edu
**We are not hammer-wielders, we are nail-holders**.
-- Rohit Khare