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Dial ‘M’ for mayday

Cutting the cord on e-commerce can be painful. Net Ventures hed: Dial ‘M’ for mayday dek: Cutting the cord on e-commerce can be painful. by Sean M. Dugan

We recently hit a technological milestone of epoch-shattering significance. It wasn’t petabit-per-second fiber optics, quantum computing, or a version of Windows that doesn’t crash when I boot it up. Those are practically science fiction. What I’m referring to is big: My favorite local coffee shop now has wireless Internet access. Well, for someone like me who’s up to the gills in caffeinated beverages, this is a big deal.

It is a signal that the wireless revolution is here–more or less.

With advances in certain key wireless technologies, the era of the so-called wireless Internet is nearly upon us. But unfortunately, the wireless Internet won’t be all it’s cracked up to be. If you listen to the hype, the wireless Web will be a fountain of money for all sorts of fantastic, half-baked schemes. Raise your hand if this sounds familiar. The correct answer is “Internet stock bubble.”

Everybody’s excited about the promise of the wireless Web because they see dollar signs–or, perhaps francs and deutsche marks. European telcos have spent nearly $180 billion in governmental license fees to carve out a slice of the electromagnetic spectrum suitable for wireless services. Germany alone has spent $46 billion in licenses. That’s a lot of schnitzel, my friends. Clearly, the telecommunication companies think there’s big money to be had in wireless.

The poster child for our wireless fantasies run amok is Japan. Japan’s national telecommunications monopoly, NTT, created a subsidiary company called DoCoMo to provide wireless services. DoCoMo, with its i-mode wireless Internet phones, is a rival to AOL in the number of subscribers paying for Web access-22 million Japanese, compared to AOL’s 29 million. Projections indicate that DoCoMo will be the world’s largest Internet service provider very soon.

Yet, big profits haven’t really materialized. A popular phrase has been m-commerce-short for mobile commerce. The idea is that no one can resist buying books, CDs, groceries, and whatnot via their cell phones or Palm Pilots. So far, everyone has resisted quite nicely. For some strange reason, few are in love with idea of buying stuff by conveniently punching Chiclet-sized keys. Amazon.com has all but admitted that m-commerce has been a bust for the leading e-tailer on the Net. Published reports indicate that it did a million dollars in mobile sales-less than Jeff Bezos spends on khakis in a year.

This isn’t much of a surprise. The buzz is off e-commerce, which includes m-commerce. The Net madness is over. The bubble has burst.

The interesting irony is that the reality of wireless is profound and far reaching.

Consider one thing: bandwidth. Right now, there’s a lot of money and brainpower being spent to deliver third-generation (3G) wireless technology. Basically, 3G is high-bandwidth wireless–the kind of bandwidth you think of when you think of DSL, cable modems, or T1 at work. Consider the pain and expense you typically have to endure to upgrade your PC to a high-bandwidth network. Now, consider a cell phone upgrade. You simply buy a new one, usually for less than $200.

The secret of the wireless future will be in the complex interactions between devices that could never have been networked before, either because of size constraints or practical considerations. We’re going to see an explosion in the number of devices that can be networked. The wireless Web is not going to be a substitute for the real Web–some tasks simply demand a large keyboard, lots of processing power and a big screen. But, a whole new, unforeseen Web will grow up around the vastly internetworked world of devices.

What will it mean when my car keys, wristwatch, television, and microwave can all communicate with each other? I have no idea. I imagine everyone and our devices swimming in a sea of information, like data sharks–only we’ll have the ability to leap out of the water when we want. But trying to predict the specifics of the hyper-connected future is a fool’s game. It’s like looking at a Model T and trying to imagine rush-hour gridlock in the middle of 21st century New York.

For the moment though, the wireless Web means I can write this column, surf the Web and enjoy a nice lattŽ at the same time-not a bad future.

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