The market capitalization of Amazon.com is six times that of K-Mart, yet Amazon has yet to turn a profit. What is going on? You got me. All I know is that my new stock-picking credo is buy high, then sell low. (Not a good way to get rich.) Time magazine's recent Winners and Losers said it all boils down to this: "Ten guys buy gifts online, and the NASDAQ explodes. Who owns suckerventurecapitalist.com?"
Tom Hanks and Meg Ryan weren't the only ones exchanging email in 1998. It was the year everyone took it for granted that you had an email account, even relatives and friends who still don't know what "modem" stands for. We have AOL (and cheap PCs) to thank for that one. What's next? I predict that in '99 sending targeted email messages, and building advanced applications on top of the existing Internet email structure, will be the technological sweet Spot.
What was the most interesting story about email in 1998? How it helped save one sailor's life.
In 1998, MPEG-3 emerged as the dominant format for distributing music, with thousands of sites using it to download and upload songs. Because you can fit over 100 songs on a standard CD (and play them on your PC using a wide variety of software tools), the MP3 phenomenon isn't going away, despite the music industry's attempt to create its own digital music standard. The format will continue to bloom, as more players besides the Rio come to market this year. The music industry will never be the same. A good place to read about this, along with a plea to these same executives to endorse MP3, is at Robert Seidman's site. And listen to my own comments in an interview with Sam Whitmore here.
I won't hazard a guess as to whether 1999 will be the year that broadband access, or perhaps DSL, finally reaches critical mass. What I have noticed, though, is how my own Internet usage patterns changed the moment a cable modem entered chez Strom. Surfing is faster, so everyone in my family spends more time on the computer. And we casually download huge files without worrying how long it will take. Continuous Internet access at home also makes it more palatable to listen to Web-based radio, and to track your financial portfolio and engage in real time chats.
DSL offers lots of promise, but it's far from ubiquitous. The problem is its many variations of speeds and feeds. One of the problem configurations is called gLite, which is best described as too little speed too late in the game. Brian Johnson at 3Com believes that "the entire ADSL gLite compromise is just that, a compromise forced on the telcos by the Universal ADSL Working Group. gLite means telcos don't have to figure out how to re-tariff T1 and offer full rate DSL at the same time. Give us a break. How can we possibly be satisfied with 1.5Mbps when almost the same technology will get us 10Mbps? " Expect gLite to debut in PCs later this year, but few will use it. I am still bullish on "full speed" DSL access, though.
My colleague Eric Hall said it best: "If you've got a permanent Internet connection, you need a firewall. It's that simple." As more small businesses (and homes) get continuous connections to the Internet, they will need better and cheaper firewalls. WRQ's AtGuard is one software solution; Sonic System's Sonic Wall is an inexpensive hardware solution. Look for more innovation, cheaper prices, and better features to follow in 1999.
We all missed the Era of Good Feeling back in the post-war America of the 1820s. But the Era of Bad Feeling is certainly upon us. What else can you call a year that saw the rise of Matt Drudge, the Starr report, and Clinton's video deposition, all shoveled full-force onto the Net, not to mention the hacking of the home page of nytimes.com. And it will only get nastier out there in 1999.
The only payment scheme accepted at all web storefronts is good old plastic. Despite attempts by the banking industry, IBM, and a few other vendors, Secure Electronic Transactions went nowhere this past year, and I predict it will die off in 1999. Electronic wallets, or eWallets, will suffer the same fate. Maybe now that we know how people are finally paying for things they buy online, store owners can make the shopping experience easier for customers.
This past holiday season the news media was obsessed with reporting how much money people were spending online. What you didn't here much about were the problems eShoppers encountered. Sites were slow and overcrowded. People's systems crashed. Unable to handle the traffic, some sites shut down. On others, it was near impossible to uncover the shipping costs or find out if an item was in stock before you bought it. Here is more on the offenders.
This past year saw an explosion of applications using the browser as their interface of choice. Of course, Microsoft would like to claim that they invented the web desktop interface (found in Windows 98), too. Everyone does it: firewalls, printers, email servers, cameras, routers, hubs, and calendaring software are just some examples you'll find here: http://strom.com/places/browsergui.html. Where will this go? I don't really know, but expect more applications to make use of the web in new and interesting ways this year.
That's my list of trends and predictions.
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