[AfrICANN-discuss] Little by littler...

Anne-Rachel Inné annerachel at gmail.com
Fri Aug 3 14:46:24 SAST 2007

*The latest from the desk of the Editor-in-chief :
by littler...    *Fredric Morris*

Little is getting big, but less, as architect Mies Van der Rohe said so many
years ago, is definitively more – at least in the ICT world.

In the eLetter at the end of May this year, I commented that Microsoft's
parallel interest in on-line advertising, in online-software usage, widgets
and mobile computing was far from coincidental, that all the signs point to
a grander scheme and a tight interconnection between these spheres of

Reports from Microsoft's recent *Financial Analysts Day* at their
headquarters, only served to confirm my suspicion that we are witnessing the
birth of a major trend - doing more, affordably, with less. According to a
variety of published reports, Steve Ballmer, told financial analysts that
they will be investing heavily in online advertising, online services,
consumer electronics and: "software plus services". Microsoft, it seems, is
transforming its business model orientation; apparently, it will now centre
upon software plus online services.

Another focus of its business model will be online advertising. The last
time I felt such drive, such enormous determination to change, was when
Microsoft jumped on the Internet bandwagon. Microsoft is taking on a
potentially disruptive technology - its enemies, I am *not* one, might say
like a snake changing its skin - and make it its own. If the MS Internet
Explorer serves as an example of what a fundamental change in Microsoft's
strategy portends, the sector is about to undergo a major shift in

"We are hell-bent and determined to allocate the talent, the resources, the
money, the innovation to absolutely become a powerhouse in the ad business,"
Steve Ballmer is quoted as saying. Ballmer outlined their commitment to
advertising supported Web services.

The command centre for hell might well be the new centre dedicated to online
advertising and search services announced by Bill Gates. Hell's command
centre, Microsoft renamed it the *Internet Services Research Centre*, will
concentrate upon searching scanned images - especially print publications,
fighting spam, determining new ways to build the relevance of search
results, and who knows what else.

Ballmer made it clear that the markets targeted - advertising-supported Web
services, online services in general and consumer devices - are all leading
markets for the company's software. Online Services and the Microsoft
Entertainment and Devices division have never done well, but Microsoft has a
record of betting on losers for years - look at the history of its server
software - before they become major revenue generators.

I'm not as good as they are at predicting winners, but when I drop mobile
services and mobile Internet devices into the equation with the above
strategies and multiply, I see a new model for the sector emerging with
Microsoft, once again, at the forefront.

Microsoft, notoriously, has never focused upon advertising revenue as much,
or at least as successfully, as companies like Google. Now, though,
according to Steve Ballmer, they will be an "advertising and devices"

The most significant idea found reading Bill Gate's presentation, was not
the perennial promise of  more powerful user-oriented functions for slicker
devices coupled with a better user experience. The noteworthy concept, the
one that I believe centres the MS strategy, is that of reconsidering the
traditional computing model that confines processing to the device, a
computer of some sort, and moves much of the processing to the Internet.
It's not a new idea, but now, with the blessing of hell, its time may have

The Internet-as-the-processor is ideal for handheld,
always-carry-it-with-you, mobile computing. So too is an ad-based revenue
model for the massive majority of users that are always a bit strapped for
cash. With billions of users throughout the world, you don't need to hit
users with high prices to earn fantastic profits from advertising and
micro-fees-per use.

The business model works, and there are several additional advantages.
Software, for one, is much harder to pirate with this sort of model. Most
important, though, is the change this makes in the way people use the
Internet, in the equipment - the devices they use and the way the whole
value chain of the industry slips and slides off the road it's been

This type of computing needs a lot of bandwidth. Current mobile broadband is
too slow and too expensive, but WiFi, WiMesh, WiMAX and, perhaps, LTE (*Long
Term Evolution* – UMTS mobile broadband) promise faster and cheaper wireless

Since the storage and computing power can reside on the Web small, handheld,
mobile devices with full keyboards can serve as full-function computers. The
screens are small and the keyboards cramped, but these devices, potentially,
can do anything larger more expensive equipment can do. Add a full-size
keyboard and a box to connect it to a television or monitor and you have a
set-up that many people - perhaps most eventually – will be using,
especially in developing regions.

In a few years, powerful, low-cost, slip it into your pocket, computer and
communications devices will become a common sight everywhere in the world
and this 'personal mass-media' will be a force to be reckoned with.

Today, in some age groups and communities, communications through sites such
as Facebook that describes itself as, "a social utility that connects you
with the people around you", and MySpace, "an online community that lets you
meet your friends' friends", are rapidly taking over the functions of more
traditional Internet email communications. These kids just don't use email
much, except to talk to adults! This is happening not just in the USA, the
EU and parts of Asia, but in Latin America and probably other parts of the
world as well. These on-line communities let one network, exchange messages,
share photos, and clips with other members of your personal community of
friends and acquaintances.

Nowadays, many students are starting to log into Facebook through their cell
phones. In a few years, as mobile broadband availability grows, I expect
mobile access to predominate. Also In a few years, these students will be
adults, and bring at least some of their communications habits with them to
the business world. Although email is still the standard for business, the
millions upon millions of Facebook, MySpace and other similar networks

With millions and millions of members each, MySpace and Facebook are among
the frontrunners to control a huge chunk of this promising market. Of
course, they have a small problem coming up - the Microsoft elephant will
soon be barging in on this market and, oh yes, so will Sprint Nextel teamed
up with Google.

A few days ago Sprint Nextel announced they would develop a new mobile
portal to provide Web searching and social networking using WiMAX. The
announcement said Sprint's wireless broadband network, together with its
ability to detect location will be combined with Google's email, chat and
other applications.

Couple all this with over-the-air software and Web services and lower
subscriber costs financed by ad- based revenues, carry-at-all-times, mobile
Internet devices and little by little… anyone ready for a revolution?

Anne-Rachel Inne
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