Massive Computer Market Imminent
Two technological trends will bear close watching next year. One is a dramatic drop in the cost of computers. The other is a huge increase in their power.
Taken together, these forces promise to radically change the lives of tens of millions of Americans.
When I began writing this column two decades ago, my word processor cost $7,500, or about $13,333 in today’s dollars. In this shopping season, good computers - not close-outs or flimsy clones - will sell in many U.S. malls for under $800.
Once you shave a few hundred dollars more off those already low prices - analysts say that’s coming - computers will become the kind of commodities that all but the very poor normally possess, like TV sets or telephones.
While cyberspace has been sorely hyped, only 15 percent of U.S. adults regularly access the Internet, the network of networks which enables users to access information anywhere on Earth.
Such computer giants as Intel Corp., which markets 90 percent of all PC chips, see widespread sales of low-cost machines as inevitable. Andrew Grove, Intel’s chief honcho, tells Business Week: “For us to walk away from a market whose size is going to be measured in the tens of millions of units per year, perhaps bigger, is inconceivable.”
When a true mass consumer market in these machines develops within the next few years, the computer and the TV set as we now know them will merge into one seamless information retrieval and entertainment service.
Trade journals dispute whether the new digitized standard will integrate video services into computers (such units already ship) or, conversely, plop computers atop TV sets in black boxes (such units are due to ship soon). Since both paths lead to the same result, it’s a difference without a distinction.
What will truly empower these mass-marketed hybrids, and thereby change countless lives, is the speed at which these machines will be able to access Internet sites. That will be done by vastly boosting what computer mavens call the Internet bandwidth backbone.
Bandwidth involves the diameter of the “pipe” that pumps external data into a computer and the rate at which that data can move. In the decades that the telephone industry was the top datamoving dog, it wired up cities in response to population trends, adding capacity to their networks on the basis of how quickly industry executives estimated the universe of phone users would expand.
But that model crumbled as the speed at which computers can communicate has grown more than a million times in the last 25 years. Today, a single fiber optic cable can carry about 14,000 voice calls at once.
The next major breakthrough will come when ordinary folks can, from their own homes, view live full-sized, high-quality moving pictures on Internet-TV combos. That stage isn’t too far off.
What still needs to be addressed are the immense economic and regulatory shifts that must follow in the wake of the new digital mass market.
xxxx