Monday, July 25, 2005
Fifth Wave of Computing
In the July issue of Business 2.0, senior writers Michael Copeland and Om Malik argue that computing is entering its fifth wave, an "epic technological transformation" comparable to the introduction of mainframes in the 1960s, minicomputers in the 1970s, personal computers in the 1980s, and networking and the Internet in the 1990s. The three forces feeding this new wave, they say, are cheap, powerful computer hardware, especially mobile phones and handhelds; broadband Internet access from almost anywhere; and "technological openness," meaning the emergence of a "global tinkerer's workshop, where thousands of creative minds are constantly cobbling together code that entrepreneurs and even established businesses can cannibalize, free of charge, for parts to build new software systems."
Now, compare those three forces to the tagline of my Continuous Computing Blog: "Mobile Devices + Wireless Everywhere + Web 2.0 = A Social Revolution." On the first two elements, we're in exact agreement. And what Copeland and Malik call openness, I'm simply calling Web 2.0: a set of standardized, remixable tools for building sophisticated Web-based software services. When I talk about Web 2.0, I have the same examples in mind as those cited by Copeland and Malik (Amazon Web Services, Google's APIs, et cetera).
Bottom line: the Business 2.0 piece is the twin of my Social Machines piece. But it's a fraternal twin, not an identical one. I focus on the personal and social implications of this new state of continuous computing that we're all entering. Copeland and Malik, as befits their venue, focus on the business implications and how companies can get in on the opportunities presented by this new way of deploying computer power. Their piece makes some key points and predictions that I would have loved to include in my own article, if not for the fact that it was already 5,000 words long (about 50 percent longer than our typical features):
- "The fifth wave...will coincide with, and in some ways fuel, a surprising increase in corporate IT spending. And as the new wave sweeps in, it will create fertile conditions for starting new companies--even new industries--and remaking old ones."
- "The ability of a company to easily scale services from a single customer to millions is a defining feature of the fifth wave....The secret to doing that is the 'Amazon-ification' of software. People tend to think of Amazon as an online store, but it can also be viewed simply as a software platform for delivering a service over the Web." [On this point, see my January case study, Amazon: Giving Away the Store.]
- "Some of the richest opportunities churned up by the fifth wave are in the tricky but vital need to better merge the computer and the telephone. There remain significant technical hurdles to seamless interaction between the two technologies." [Amen. But while Copeland and Malik focus on interactive voice response systems, there's another huge disconnect between the capabilities handset manufacturers could build into cell phones and the meager services the carriers have actually seen fit to offer.]
- "Over the long haul, one of the most important implications of the fifth wave is that it could create a more level playing field than the tech industry has seen in many years. The old titans may still do well. But many experts believe that the sheer number of opportunities, the cheapness of basic technological components, and the ever lower barriers to entry for many new niches could ring in a golden era for entrepreneurs and startups."
Right on. Copeland and Malik have written one of those rare tech-business stories that's both optimistic and realistic. They make no attempt to hide their enthusiasm about the future of mobile computing, but they never cross over into hype and hand-waving. Believe me, that's a hard line to walk.
If there's anything missing in the Business 2.0 piece, it's a discussion of what real people can actually do with the new computing and communications power that the tech industry is handing them, and how this power is already beginning to reshape the way we live, work, and learn. But I guess that's where my piece comes in. ;-)2.
How to Ride the Fifth Wave
...Roughly speaking, the history of computing has unrolled in four major waves. The first came in the 1960s, as mainframe computers advanced into the corporate world and became essential business tools. The 1970s saw the wide adoption of the minicomputer. Then came the personal computer in the '80s, followed in the '90s by networking and the Internet, and the spread of distributed computing. Each successive wave of technology brought with it giant leaps in productivity and huge increases in spending. Each transition lifted some companies (think IBM (IBM), Microsoft, Yahoo (YHOO), Google (GOOG)) and swamped those that couldn't adapt (think Wang and Digital Equipment).
Now comes computing's fifth wave. It's different from the sea changes that came before it. For the first time, the shift isn't driven primarily by a single piece of hardware or by how corporations deploy it. Instead, it results from the unprecedented coalescence of three powerful technological forces: cheap and ubiquitous computing devices, from PCs to cell phones to tiny but potent systems that are beginning to show up in everything from bedroom lamps to key chains; low-cost and omnipresent bandwidth; and open standards -- not just Linux source code but the opening of other software as well as corporate databases. The fifth wave puts computing everywhere. It offers access to limitless amounts of information, services, and entertainment. All the time. Everywhere.
Best of all, the fifth wave serves as a framework to understand where most of the juiciest opportunities in business are emerging today. It will coincide with, and in some ways fuel, a surprising increase in corporate IT spending. And as the new wave sweeps in, it will create fertile conditions for starting new companies -- even new industries -- and remaking old ones. It won't always be smooth sailing. "It's not going to be this linear progress that we've seen so far," says Dick Lampman, head of Hewlett-Packard's (HPQ) research labs. "It's this perfect storm of technology rolling in, and it presents thousands of new opportunities to develop devices and services." For anyone who has ever dreamed of building a game-changing, money-gushing new enterprise, the message is unmistakable: Surf's up. And if you catch it right, the fifth wave could be a mind-blowing ride.
...A less understood but equally critical development is the spread of technological openness. The open-source movement has created a global tinkerer's workshop, where thousands of creative minds are constantly cobbling together code that entrepreneurs and even established businesses can cannibalize, free of charge, for parts to build new software systems. But fifth-wave pioneers grasp another dimension of technological openness: Many have begun to open up their own databases and software protocols, allowing the tinkerers to create related applications or sell symbiotic products and services. Amazon has taken this approach further than anyone, and Google isn't far behind. (See "The Great Giveaway.") "Open-source changes the rules of the game," says Tim O'Reilly, founder of tech publishing powerhouse O'Reilly Media. "Anyone can add and innovate, bring new pieces to the party."
Together these forces have created the technological infrastructure from which the fifth wave is rising. In essence, we are now surrounded by a kind of ecosystem of connectivity, unseen but everywhere, constantly growing, seemingly by itself. One of the distinguishing characteristics of the current shift compared with past ones is how much it is expanding from the grass roots up. Corporations supply some of the momentum, to be sure. But to an unusual degree, consumers are powering the fifth wave, as armies of mobile users discover new ways to exploit the connectivity that surrounds them -- and businesses pop up to cater to them. Downloadable ringtones constitute an industry worth $2 billion a year. Sales of downloadable screensavers for cell phones have gone from basically nonexistent in 2001 to an expected $275 million this year.
|Among the fifth wave's early leaders are both familiar old faces and aggressive new startups.|
It constantly tweaks its Web interface to securely serve millions of online customers, and was among the first to open up its databases to allow all comers to develop related services.
Using open-source code and piggybacking on existing networks, Ambient's technology pulls data from the Web and displays it on everyday devices.
This startup's software adds open standards like VoiceXML and SIP to existing customer-service phone systems, paving the way for a host of new voice-enabled functions.
Cisco's routers, switches, and storage devices make it possible to have a persistent connection anywhere and anytime. Now it's charging hard into the market for Internet phones.
All its services -- search, e-mail, even blogging tools -- work anywhere there's an Internet connection and a browser. And it's extending its technology into the wireless arena too.
Big Blue has dumped most of its PC hardware business and is pushing both Web services and open-source platforms.
Its CRM software is delivered over the Web and can be accessed with almost any wireless device.
By marrying computing and telephony in a tiny software download, Skype is using constant connectivity to create a next-generation phone system.
This startup combines open-source software and a simple interface to provide HR software over the Web to clients in more than 70 countries.
Tibco helps stitch together a company's e-business infrastructure, linking suppliers, vendors, and customers using Web services.
Its open-standards call center router helps multinationals monitor their offshore customer support.