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TECH TALK: IT’s Future: Affordable Tech Utilities

August 22nd, 2003 · No Comments

Nicholas Carrs points have, not surprisingly, got a hostile reception from the tech community, with CEOs of various IT companies (including Intel and Microsoft) being very critical of the comments. Tech companies feel they are being hit by Carr when many are down for the count. The recession in the industry has now lasted for over three years, and there is only a slim ray of hope for revival in the second half of the year. So, what should tech companies do?

The key to looking at ITs future is to think about it as a sustaining innovation in the developed markets and a disruptive innovation in the emerging markets. The developed markets will have flat-to-limited growth in the coming years, but the emerging markets are where the next set of opportunities are materialising. Technology priced in dollars has been largely out of the reach of all but the elitist enterprises and families. There is now an opportunity to make technology affordable to open up markets that are 10X larger than the markets that have been served so far.

The next set of opportunities will therefore be driven by the twin themes of Utility and Affordability. IT is a utility, but at the same time it needs to be affordable for people and organisations to use. This requires thinking and solutions that are very different from the ones which the current set of users in the developed markets have been using. These non-consumers of IT have limited legacy and limited money. Taken together, if the right technology at the right price comes along, adoption will take place rapidly. The next IT revolution will, therefore, start from technologys new markets todays have-nots and then make its way up the pyramid.

So, what are these new technologies which can create the foundation for Affordable Tech Utilities? These are what UBS Warbug has called cold technologies. According to me, the key building blocks are technology solutions like server-centric computing (thin clients-thick servers) with remote server management, open-source software, WiFi and Ultrawideband, voice-over-IP, web services, weblogs, RSS-enabled information aggregators and marketplaces. Individually, they have been around for a few years, so they are well-known. Taken together, they create a new, pervasive technology infrastructure that can facilitate the mass adoption of technology across emerging markets.

The two large, untapped, and presently invisible markets that technology companies should look at in the emerging markets are the small-and-medium enterprises (SMEs) and the rural markets. Both these markets are very similar in the sense that they suffer from large-scale inefficiencies because a co-ordination failure among the solution providers has ensured that they have been largely ignored. Their numbers are large. In India, there are over 30 million employees working in 3 million SMEs, and nearly 700 million people living in 600,000 villages. They are waiting for affordable tech utilities to transform their futures. Anyone interested?


TECH TALK IT’s Future+T

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