January 20, 2004
Rob Patterson on Trends
Posted by Stuart, January 20, 2004 8:10 PM
You can buy today for 700 dollars a computer with power that would have cost 25,000 5 years ago. In 5 years time you will be able to buy an amazing machine for $100 and everyone will have one. You don't believe me . You can buy a DVD player today for $50. The point is that pc's will be truly ubiquitous as TV is.
So with a $100 pc, software will have to get very cheap just as with a $50 DVD player, $25 DVDs look expensive.
So where will software go? Look at open source software - You can buy the new Office 2004 for about 700 dollars or you can buy Open Office for $0 - it does not have all the features of Office but it has what most of us need and is compatible with all systems. All the low end proprietary software will die and be replaced with packaged Open Source. Making Open Source easy to use will be a growth business.
Look at the phone - in 5 years we will all have VOIP where our calls go for nearly free using the internet. At home we will have voice and image with high quality video. The traditional wire based phone - dead. At home all will have WiFi so every room in the house will be available for a connection with no wires. What else will get connected? It costs about $100 to do this today. On the road WiFi will be in every coffee shop, every public place, in your car, on the plane in every hotel. This will put pressure on offices as we know them. You don't need the office as where the wires and the Lan is. What will this do to the "Office" as we know it? Businesses that support SOHO will boom.
Look at travel - in 5 years all travel will be booked online. Much of it is now. There will be a wonderful business supporting small operators who need more effective links to the traveller. The whole cultural tourism movement is in the best place to capitalize on such a network as is blogging to be the main tool of promotion for real experience.
Look at university - 4 years ago there were 2 online course at UPEI. Now there are about 60. Where do you think that this is going folks? The real breakthrough for online education has not yet begun. I see blogging and wiki's being huge here and a move away from proprietary systems such as Webct
Look at all the new creative tools. Garage Band and the whole iLife strategy is important. Think how the music industry is being changed. Now think of how the entire entertainment industry is being changed - the shift is away from the need for creative people to be indentured servants to large corporations - they will be able to go direct not just in distribution but more importantly in production. Many films will go direct.
Retail - we can see the power of the shift. Not that face to face will go away but that direct online will take an ever greater share and will maybe move to where most shopping takes place. In 5 years I bet that at least 50% will be online. A huge opportunity to disintermediate say the food retailers who have a gigantic legacy investment in their current system. An opportunity for producers to process and to sell direct - the same trend as in music and film.
This in reality the trend. To break free of the model where the big guy sits in the middle between the producer and the buyer. Building hubs for producers to go direct will be the new way. iTunes is in effect part of this process. Where is the iTunes for food retailing? Think of publishing and what this means when print on demand is real and most of the costs of publishing go away? A next step for Amazon is to go to print on demand - this will "Dellize" bookselling.
Where does this leave the big guys in the middle? We can see the pressure on the music industry. This pressure to cut out the middle man will grow everywhere and in all fields. The opportunity is that most of the big guys will fight rather than switch and hence be doomed. There is a huge opportunity to support new direct networks. I would not waste a lot of my time in helping the big guys to defend themselves - they may want to but their attachment to their system will prevent them. You don't believe me? look at the airlines - they cannot shift to the southwest culture.
So where does this leave organizations such as government who move so slowly? How will they adapt to such a dynamic world where real time two way communications cheap and powerful? Where does this leave our current view of the democratic process where we only give feedback once every 4 years? Where does this leave Parliament and question period? I think that there will be huge pressure on our entire political process and on how government services are delivered. Government will have to adapt as the voter will demand it. As hard as it is, I think that there is an opportunity to work here - even if only as concerned citizens - after all it is our country. The governments that can adapt will become cheaper and better - we will all gain. The political system that adapts will also be more responsive and effective - we all need this!
I am not saying that this is all good - I am saying that the trend is powerful and has a shape that we can see now.[Robert Paterson's Weblog]