TECH TALK: The Years That Were: 1997

From Forbes 80th anniversary issue (July 7, 1997):

What has taken steels place in our measure of economic power? Software, drugs, computers, mortgage securities. All these things have in common the fact that they dont weigh much and are cheap move, even over long distances. They are, in essence, products of the human mind rather than of the earth and blast furnaces. A 300-Megahertz Pentium II chip from Intel is worth more than weight in gold. A program sold by Microsoft weighs nothing at all. It can be shipped instantaneously to any point on the globe.

The Internet will make it easier for newcomers with a design or price advantage to break into established markets; financial muscle and established market shares will still count, but for less than in the past. The Internet will bring costs down further and create huge profits and top-paying jobs for those who can figure how to use it to bring buyer and seller closer together.

But take nothing for granted. Examine every premise. Intels Andy Grove set the tone foe this exciting, frightening era when he called his 1996 book Only the Paranoid Survive. Happy paranoia.

From a Business Week cover story (August 25, 1997) on Silicon Valley:

20% of the worlds 100 biggest electronics and software companies have taken root here. Indeed, the $450 billion market value of the publicly held companies in and around the Valley is approaching that of the entire French stock market. The resulting wealth is staggering. Last year, on average, a Valley company went public every five days, minting 62 new millionaires every day.

The Valley and the rest of the US must remain vigilant. Left unconstrained, giants such as Intel and Microsoft could yet despoil the Valleys virtuous cycle if they become so successful that they either buy up or squeeze out too many small competitors. Such an outcome, while unlikely, would eventually foul the fertility of the region. Alternatively, a deep recession combined with a big drop in the stock market, could kill off a lot of small companies and dry up the influx of capital.

From Forbes (October 6, 1997):

The new law of the photon says that bandwidth triples every yearAs competition grows in world telecommunications and national boundaries fall, David Payne predicts, there will be no cost difference between a call around the world and one to the corner grocery shop. By todays standards, communication will be ridiculously cheap. Which is precisely why we will be spending more money on it than we do today and why the telecom business can only grow and grow and grow.

From Forbes ASAP (December 1, 1997):

Its 1997 and command and control is dead. The chip and the Net have killed it. IBM is worth half of Intel. The Soviet Union has passed away, and network television seems determined to follow. Even the CIA gets its news from cable television and the InternetSingapore, Malaysia, Thailand the soft authoritarian miracles of yesterday have all slammed into hard walls. Japan-style corporatism is mired in 1% annual growth. Europe wobblesEverywhere you look today, command and control is in retreat. What is on the march? The chip, the Net and us.

Tomorrow: 1998

The Years That Were T

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Rajesh Jain

An Entrepreneur based in Mumbai, India.