WSJ has a special report on broadband:
After years of hype and false starts, we can finally declare it: The Age of Broadband is here. It may have arrived with little of the fanfare first envisioned at the height of the tech investing bubble. But it has something more important than buzz. It has critical mass.
That’s a lot of people, and it’s already having a huge effect on what we see and do online. Video and music increasingly are becoming the norm, and consumers are quickly warming to high-speed e-commerce. In fact, those who move to high-speed pipes are three times as likely to download videos as those beholden to the slowpoke speeds of dial-up modems, according to a survey by the Pew Internet and American Life Project, a Washington nonprofit organization that studies the impact of the Internet.
The minutiae of daily life are changing, too, says Jed Kolko, an analyst at Forrester Research Inc., a research firm in Cambridge, Mass. A world where broadband dominates “is a world where computers and the Internet are involved in more and more of our mundane transactions,” says Mr. Kolko. “Things like checking flight status, movie times, bank balances.”
Perhaps broadband’s greatest economic effect will be the hardest to measure: that as a catalyst for all kinds of offline behavior. People who have high-speed connections, for instance, are more likely to buy new digital cameras, using their speedy connections to send digital photos to friends and family. They’re also more likely to buy home-networking equipment, such as Wi-Fi cards, to share the bandwidth among multiple PCs.
Looks like the combination of wireless and broadband is all set to bring in the next phase in usage of the Internet.
Business Week has a special report (Asian edition cover story) on the shift to wireless, and the impact on fixed-line carriers:
There’s no doubt the old order is crumbling. Although the total number of fixed phone lines in the world is still creeping up, wireless is growing six times as fast. This year, figures London telecom researcher Ovum Ltd., the number of mobile subscribers will exceed fixed lines for the first time. Wireless carriers now take home nearly half of global voice revenues, up from 9% a decade ago. In Finland, an estimated 25% of households are now mobile-only. Even worse for fixed-line operators, the amount of money they take in from each line has fallen by one-third since 1997. As a result, global revenues for fixed-line voice services are expected to fall by 2.2% this year, according to the Geneva-based International Telecommunications Union.
Turmoil, however, doesn’t mean termination. Fixed-line phone companies will still pull in $455 billion in revenues this year from voice services. And the telcos remain veritable cash factories: The world’s leading carriers will spin out $131 billion in free cash flow this year, estimates brokerage Merrill Lynch & Co., up 10% from 2002, thanks to aggressive cost-cutting. Next year, Merrill says, cash flow will edge up a hair, to $132 billion. Growth may no longer be what it was in the 1990s, but the 45 stocks in the Standard & Poor’s Global Telecommunications Services index are up 9% for the year.
The fixed-line carriers have an ace in the hole: their wires. “The biggest factor in their favor, bar none, is that they still own the local network,” says analyst James Eibisch of market researcher IDC. How is that an asset if the world is going wireless? Because the wired network will always have the advantage of higher bandwidth, or communication speed, and in the emerging world of digital media, faster is always better. That’s why outfits like Sonera are betting on DSL. “Broadband has become the driver for fixed operators,” says Bruno Duarte, a partner at consultant Arthur D. Little’s telecom practice in Paris.
Here. Among the winners:
Favorite Audio Tool: XMMS
Favorite Backup Utility: TAR
Favorite Web Browser: MOZILLA
Favorite Database: MYSQL
Favorite Distribution: DEBIAN
Favorite E-mail Client: EVOLUTION
Favorite Graphics Program: THE GIMP
Favorite Instant-Messaging Client: GAIM
Favorite Office Program: OPENOFFICE.ORG
Favorite System Administration Tool: WEBMIN
Favorite Linux Web Site: SLASHDOT
Favorite Desktop Environment: KDE
Phil Wolff has an excellent post on “services you might want to bring inside [the enterprise] to help your blognets grow and prosper…I’ve grouped these services, arbitrarily, into three categories: Discovery, Reading, and Writing. Discovery services help you find stuff and navigate, and understand blognets and the blogosphere as a whole. Reading services help you keep up with relevant information. Writing helps you author and publish.”
[via Dina Mehta] Sean Carton writes about social networking sites, and says “viral affinity communities will take off in business much the same way blogs did…only more so.”
Why more? Because getting people involved with your business, building community, repeat business and customer involvement are some of the most important means for staving off the downward pricing pressure and commoditization that have resulted from the Internet. Brands — strong brands, with strong brand affinity and loyalty — can charge more, keep customers longer, and tap into the most persuasive form of marketing: word of mouth. The ‘Net’s ability to bring communities together (and grow them virally) is one of the most powerful tools for online brand-building.
DeanLink, Friendster and Ryze combine all the most powerful aspects of viral marketing, affinity marketing, multilevel marketing and brand affinity in one place. They leverage the power of interactive media by allowing those most committed to the brand — the most loyal users — to bring others into the fold. Previously, these types of efforts were segregated. Combining them in one place where people with an affinity for a brand (or a need for support) can meet others with similar interests and recruit still more people is a powerful platform for building very strong brands.
How are these different from simple online communities? Unlike communities of the past that were more or less message boards, these communities are built one invitation at a time by people-who-know-people. Not forums for flame-wars and lurking, these are true communities of like-minded people who already have real-world connections to one another, and an affinity for the brand supporting the group. Result? Strong brand connections through strong interpersonal connections.
1. Computers: It may seem very obvious that computers are an important business tool, but in most small- and medium-sized enterprises (SMEs) in emerging markets, the penetration of PCs is no more than 10-20%. This is because of the investment needed for a PC. The result: a device as fundamental as a computer is being used by very few SMEs for real productivity applications. What is needed is for the cost of computers to come down so that there can be a computer for every employee only then will SMEs begin to rethink their business processes and achieve major leaps in productivity. Two ideas to bring down total cost of ownership are: server-centric computing (all processing and storage happens on the server, which can be a high-end desktop for smaller businesses), and low-cost, low-configuration thin clients for users (which also simplifies management). Either way, having a computer on every desk is the first step that an enterprise needs to take to begin benefiting from technology.
2. Internet: Connectivity to the Internet is another fundamental building block for the SME. The Internet is not just an information resource, but can be a powerful marketing tool. Every individual in the company must have Internet access. Being able to visit websites of potential customers, partners and competitors bridges the information divide. Getting access to industry directories and niche publications helps make people abreast of all the new developments. Search engines can be good, cost-effective marketing platforms. In other words, the Internet with the computer creates connected employees not just to each other, but to the outside world.
3. Open-Source Software: Software is the engine that drives the computers and makes them useful. For long, software had just three difficult options: paying a lot of money for the applications (since most pricing is dollar-denominated), piracy or non-consumption. Now, open-source software now creates a fourth option: affordable solutions. Open-source software is a godsend for SMEs, especially those in emerging markets. For almost every component in the stack of applications that businesses need right from desktop productivity applications and messaging servers to accounting and CRM applications, there are equivalent open-source applications which are more than good enough for business use.
4. Broadband: High-speed connectivity to the Internet and across an enterprises offices is very critical for business. It takes away some of the friction of doing business. Broadband is the solution to the connectivity woes that bedevil most SMEs in emerging enterprises. Bandwidth in India is about 50 times more expensive than the US. Poor connectivity hinders the use of new technologies for effective business. Countries need to learn from South Korea, where a government initiative has seen affordable, broadband connectivity made available to small businesses, along with specialised, hosted applications relevant for different verticals.
Tomorrow: New Technologies and Trends (continued)