Date: Thu, 22 Apr 2004 19:23:32 -0500 From: Michael Catolico <mcatolico at mindspring.com> User-Agent: Mozilla/5.0 (Windows; U; Windows NT 5.1; en-US;
rv:1.4) Gecko/20030624 Netscape/7.1 (ax) X-Accept-Language: en-us, en MIME-Version: 1.0 To: lbo-talk at lbo-talk.org Subject: Re: New Business Model
As Doug pointed out the "dummy terminal" model has been tried before. In fact pre-PC days that was the prevalent paradigm: i.e. a super-powered mainframe would store programs and warehouse data; user terminals would be used as access points. PCs changed that with ever more powerful processing on a desktop.
With the emergence of the internet & broadband access the ASP (application service provider) model has returned. A lot of firms came into existence in the dotcom heyday. ASP were/are supposed to be transformative for working people since you can conceivably work on files, conference with co-workers, etc. anyplace any time (joy!). My take is that consumers were not resistant to the model but that access networks were not yet fully deployed (e.g. monopoly phone companies were slow to deploy realistic, cheap two-way broadband), IT departments were concerned about security, and bosses were concerned about monitoring telecommuting workers. But as more people have faster internet connections and wireless options are becoming commonplace and more secure, the model is gaining adherents.
There are pros & cons associated with the model from the consumer, manufacturer, software vendors and potentially a policy perspective. Basically the consumer friendly features are supposed to be access to previously hyper-expensive software and the latest upgrades at a lower per use/r cost and interactive collaborative work processes. It should make hardware less expensive since all people would need is a decent processor, keyboard, monitor and internet connection - all programs & files would be stored on remote provider servers. Of course it means that the big vendors will get even bigger - and they will ensure that every user is accounted for (and paying royalties) - i.e. no more software "sharing", no bootleg versions of microsoft products, etc.
To some extent we are all already part of this kind of model to some degree: email servers and websites are hosting/storing much of the info we use. The preponderance of internet gaming and media file swapping are an early indication of the potential acceptance and popularity of this business model. This is one reason why the intellectual property rights issue is so fiercely being waged. And incidentally this is a big reason for Sun's battle with Gates inc.
The likely result: "consumer convenience" = "monopoly control."
michael catolico