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IBMer Sees the Net’s Future

Wednesday, June 30, 1999

Publication: UpsideToday
by Phil Harvey

Technology investors know what to expect from one of Richard Shaffer’s conferences: plenty of good ideas to gnaw on and good companies to look at. The program of his Enterprise Outlook conference even lists the participating private companies by what their future financing plans are.

At Tuesday’s sessions in Burlingame, Calif., Shaffer presided over several discussions focused on building connected businesses. Sparing his audience the sensory overload and arrogant drivel that too many industry gatherings soak in, Shaffer’s show modestly hoped to tell attendees where technology may be heading.

E-Business and the Future

Highlighting the Tuesday morning program was IBM’s vice president of Internet technology, John Patrick, whose presentation was titled, “E-Business and the Future of the Internet.” (OK, not all presenters share Shaffer’s flair for understatement.)

Patrick began his talk in his usual way–by pointing out that while it seems to us that everyone is connected to the Internet, in terms of the world’s population, hardly anyone is on the Net, not even 1 percent.

But they will someday be connected, and when that happens, power will shift from institutions to individuals, he says. Along the way, some of the things Patrick believes will shake up the Internet world include the following three goodies:

Instant Messaging: Patrick demonstrated a prototype Instant Messaging technology that took a typed message in English, translated it to German, then, using a text-to-speech technology, relayed the message to its recipient in Germany. “Let your mind wander and think of the possibilities of a multilingual, real-time intercom,” he says, grinning from ear to ear.

With no language barrier, instant conversations would tie together people best suited to solve business problems no matter where in the world they live.

Symbiotic Video: Nothing new here. You see an item on a TV commercial, you click the item, you’re taken to a special Web page where you can buy the item. The Home Shopping Network meets the Internet–but, it is hoped, with better products.

Lego MindStorms: Sure, it’s just a bunch of Lego robotic machines that kids can build and control using a simple computer program. The payoff, Patrick says, is that Lego MindStorms illustrates that kids do not have to be taught that computer programming is hard.

Net Measurement

Besides far-reaching Internet applications, Patrick told investors how to size up the companies they were thinking of investing in. The key, he says, is to pay careful attention to how companies embrace the Web. “If they think about the Web as something they have to accommodate–that’s a poor strategy,” he says. The Internet should be the core of every business, he says, and every business strategy should support it.

Sure, it’s obvious where he’s coming from. The gospel according to e-business is pervasive throughout Big Blue, and their competitors have been scrambling to position themselves in the same light.

Patrick’s not shy about pointing out that IBM has been called into more than 18,000 consulting engagements to help major companies become e-businesses. His points seemed well-received by an audience of investors and industry folk for whom the mainstreaming of the Internet cannot come quickly enough.

Not surprisingly, Patrick’s of the opinion that, in the next few years, people accessing Internet content via a personal computer will be in the minority. PCs are too hard to use and, holding up a Palm VII device, Patrick says, “For some people, this is all the computer they’ll ever need.”

Yeah, and a lot of good a Palm VII is without a PC to plug into. However, Patrick’s thirst for computing simplicity is hard to discount. “You’re asking the wrong company if you ask [Microsoft] when they think personal computing will be easier,” he says.

Instead, he says the companies that will make personal computing easier are consumer electronics makers like Philips and Sony. (Microsoft, having figured that out, has made a few consumer electronics makers licensees of its “portable” Windows CE operating system.)


What would a lecture on the Internet’s future be without saying the “p” word? Indeed, Patrick says portals will always be a place for newbies and people looking for information online to go.

Just because you build it, however, doesn’t mean people will come. But, he points out, if you build economic value around communities of interest that already exist, they might. He refers to ThirdAge.com, a portal for senior citizens, as a site that fits a successful portal model.

Networks Will Evolve

One of the most interesting battles being fought around the Internet is how bandwidth will be delivered to consumers and businesses. That battle, Patrick reminds investors, is not limited to whether cable companies or telcos will dominate.

He points to wireless broadband providers like Teligent, which can bypass all pipe providers to reach their consumers, as companies to watch.

Outside In

The companies that will successfully weave their businesses around the Net will be ones that think from the outside in, Patrick says. “Remember, outside is where all the people are, and they’ll have all the power.”

That said, no Web application is worth its pixels unless it either solves a problem, makes life easier or lets you do something you never could do before. Simplicity, too, is key to building a Web presence, Patrick says.

“When you build a new Web application, get it approved by a 16-year-old before you show it to anyone else.”

With such broad pointers to the Internet’s future in place, investors here are itching to move from the lecture hall to smaller meeting rooms, where they’ll see presentations from nearly 100 companies in two days.