The Future of the Internet - agoeldi.com · 2005. 12. 3. · Prediciting the future isn‘t easy:...
Transcript of The Future of the Internet - agoeldi.com · 2005. 12. 3. · Prediciting the future isn‘t easy:...
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The Future of the InternetThe next 10 years
Efficiency Club ZürichOctober 4, 2005Andreas Göldi
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Prediciting the future isn‘t easy:Herbert N. Casson‘s visions for the telephone(1910)
• „Already the girl at the switchboard can find the person wanted inthirty seconds. [..] but it is still too long. It must be cut to twenty-five seconds, or twenty or fifteen.“
• „All persons of importance in the United States shall have call-numbers by which they may instantly be located.“
• „The distance over which conversations can be held has beenincreased to 2500 miles. But this is not far enough.I believe we will talk across continents and across oceans.“
Herbert N. Casson: The History of the Telephone, 1910http://etext.lib.virginia.edu/toc/modeng/public/CasTele.html
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The motto for today:
„The future is already here, it’s justunevenly distributed“
–William Gibson
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Agenda
• The next wave: Web 2.0• Business models for the future:
„Long Tail“and hypermediation• The disappearing Internet:
Connectivity and end user devices
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A short look back:How long are ten years?
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The Internet, 10 years ago
Things that already had been invented, but were by no meansmainstream:– Search engines– Java– PDF– Spam– Online auctions– Instant messaging– MP3– Voice over IP– Video streaming– ADSL– WLAN– Digital cameras– SMS
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Moore‘s law in practice10 years ago: my PC Today: my phone
Type
Weight
Processing power
RAM
Mass storage
Data communications
Battery life
Price
CompaqArmada 4100
2500 g
Ca. 100 MIPS (Dhrystone)
16 MB
810 MB hard disk
max. 28.8 kBit/s
2 hours
4000$
NokiaCommunicator9500
222 g
Ca. 200 MIPS (Dhrystone)
80 MB
>1 GB Flash
200kBit/s EDGE / WLAN
2 days
800$
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The next wave:Web 2.0
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Waves of innovation in IT
Mainframesystem
IBMSystem/360
1965
Mini computerDigital VAX/
Unix
1975
PC with GUIApple Mac
1985
Web 1.0Mosaic
Web-Browser
1995
Web 2.0(?)
2005
?
2015
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What we had until now: Web 1.0
• The web consists of static HTML pages that practicallydon‘t interact at all, but are merely connected byhyperlinks
• The web browser is a relatively stupid displaycomponent with very limited possibilities.
• Interactivity: mainly simple forms.
• Optimized for the consumption of information
à The web as a „shop window“
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Web 2.0
• The browser evolves into an intelligent client platform withseamless, rich interactivity.
• „Contribution“is big: Users are no longer just passive consumers,but contribute everywhere (consciously or not).
• Websites „talk to each other“and „collaborate“. Information isconnected in entirely new ways.
• More and more applications are web-enabled and can be „rented“over the Internet.
à The web as a dynamic application platform.
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Web 2.0Trend No. 1:Dynamic user
interfaces in thebrowser
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Dynamic user interface and integratedinformation from other sources at map.search.ch
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User interfaces with AJAX(asynchronous JavaScript and XML)
Source: Jesse James Garett, Adaptive Path
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Example: Gmail
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Example: Start.com
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Conclusion:
• Web-based applications can have user interfacedynamics similar to PC software
• à New possibilities for web-based software
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Web 2.0Trend No. 2:
The user as networkerand content producer
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Social Software, e.g. networking
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Self publication: Blogs, Podcasts, Vlogs, …
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Content syndication with RSS (Really SimpleSyndication)
NewsWebsite A
NewsWebsite B
Blog A
Blog B
ContentAggregator RSS Feeds
etc.
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Content aggregator
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… it even works on a mobile device
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Tagging: Flickr, the social photo platform
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Tagging: Pragmatic information structuring
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Tagging: Pragmatic grouping of similar objects
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Tagging: Pragmatic grouping of similar objects
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Social Tagging: Collaborative bookmarking atdel.icio.us
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Wikipedia
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Conclusion:
• Networking, self-portrayal, private content productionwill become a major use of the Internet
• „Collective intelligence“will be used for informationstructuring
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Web 2.0Trend No. 3:
Open APIs and softwareas service
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Battle of the open APIs: Google, Yahoo, Microsoft etc.
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Open application programming interfaces(APIs) as the basis for your own applications
My web application Mydatabase
Mapping tool Search engine Productdatabase etc.
WebserviceAPI
WebserviceAPI
WebserviceAPI
WebserviceAPI
InternetInternet
Web-service
API
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Mash-Ups and tagging:Where can I find cheap gas?
http://www.mywikimap.com/
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Web 2.0 applications:Software as service
• Purely browser-based, no local installation, minimalconfiguration
• Immediately available: just register and use it
• As simple and modular as possible
• Don‘t buy it, rent it
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Example: web-based CRM withSalesforce.com
„rental fee“is approx. 65$ per user per month
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Solution modules from third-party vendors onsalesforce.com
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Conclusion:
• The web is evolving into an open, device-independentsoftware platform on which rich, complex applicationscan be built
• In many cases web-based applications could replacedesktop software and enterprise software packages
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?Web 2.0: there are still many open questions
• Standards and compatibility, especially withdifferent browsers?
• Bandwidth?• Mobile availability?• Robustness?• Scalability?• Security?• Viability of Web 2.0 companies?
à These are practically the same questions that were asked 10 yearsago about Web 1.0
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Some hypotheses on Web 2.0
• A new generation of web-based technologies andconcepts has reached a degree of maturity that allowsusing them for serious applications on a broad scale.
• The web is developing from a „digital shop window“into aflexible medium for communication and applications
• These technologies offer many advantages. They are byno means perfect, but cheap and relatively simpleàsame recipe for success as the web browser
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Business models for theWeb 2.0 future:
Long Tail and Hypermediation
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„The Long Tail“: The bookstore example
Source: Chris Anderson / ChangeThis
Revenueper Title
Number of titlesCa. 100‘000
Profit threshold fortraditional bookstores
Ca. 2‘300‘000
Profit threshold forhybrid sellers withoutphysical stores(e.g. Amazon.com)
Profit threshold forpurely digitale-book vendors
?
à By digitizing the sales channel and later the product itself, evensmallest niche markets can be served in a profitable way
à The key question: How do you find these niches?
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Internet and intermediaries
• In 1995 everybody believed that the Internet would kill„the man in the middle“(„Disintermediation“)...
• ...and it has, in some cases.• But new, very powerful intermediaries have been created
on the Internet:
à The value chain is experiencing further segmentation, and thisgives an advantage to a new kind of intermediary:„Hypermediation“(a term invented by Nicholas G. Carr)
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Vertical search: e.g. tickets
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Vertical search: e.g. travel advice
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Local search
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Online advertising à la Web 2.0
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Amazon.com: an ecosystem of business partners
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Affiliate programs
• Amazon: 1‘000‘000 affiliate websitess that bring trafficand make money on a sales commission
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Affiliates with fully included Amazon.comfunctionality
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Open APIs for e-commerce: e.g. Amazon.com
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Amazon e-commerce serviceAffiliates can easily include various Amazon features
into their own websites:• Detailed product information and product images• Customer recommendations• Shopping basket functionality
Business model:• Using the catalog services is free, but Amazon always
has to be linked• Amazon operates a market place for others and gets a
commission from every saleà Interestingly, Amazon competes against its own partnersà The only way tiny market niches can be covered!à Profitable for Amazon: Revenue without costs of sales like
shipping, physical inventory etc.
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Very, very big,monolithical
product database
Big, monolithical e-commerce platform
UserUser
User
User User
User
User
User
User
User
User
Web 1.0: monolithicalMega-e-commerce platforms
Very, verybig product
database
Opene-commerce platform
Productdata from
third parties
Web 2.0: Open „Hypermediation“-Platforms with an ecosystem of partners
Nichevendor
Nichevendor
Nichevendor
User
User
UserUser User
UserUser
User
User
UserUser
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The next goal: controlling the user identityà preferences, social network, activities, ...
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Some hypotheses on hypermediation
• The Internet enables covering even the smallest marketniches, especially for purely digital products
• To make that possible, there needs to be a „ecosystem“of vendors that can serve their specific target customersin an optimized wayà specific knowledge about a target group and credibilitywithin that group is crucial
• The e-commerce giants are evolving into suppliers ofinfrastructure for these ecosystems
• Most probably, the winners will be both very big players(Ebay, Google, Amazon, … ), as well as very small, leanonline-shops.
• There are many new business opportunities in Internet-
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The disappearing InternetConnectivity and user interfaces
in the age of utility computing
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„Technology always develops from theprimitive via the complicated to the simple.“- Antoine de Saint-Exupéry
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1995: „I go online almost daily“Modem era
2005: „I‘m practically always on the Net “Always-on era with ADSL, GPRS, WiFi,UMTS etc.
2015: „Internet?“Utility era: It‘s just there, always andeverywhere
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Connectivity continues to develop...
Fixed Line:
• VDSL: up to 52 Mbit/sVDSL2: up to 200 Mbit/s
• Cable TV networks:up to 100Mbit/s
• Powerline?• Fiber to the home?• Satellite-based Internet?
Mobile:
• HSDPAca. 10 Mbit/s
• 4Gup to 40 Mbit/s
• Wimaxup to 70 Mbit/s
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What to do with all that bandwith: e.g. HDTV
• Much bigger resolution thantoday‘s TV standard– Up to 1920x1080 pixels
• Purely digital processingand transmission– Approx. 25 Mbit/s per
channel
• A lot of processing power isneeded in HDTV devicesà what else could be donewith that? Samsung:
HDTV displaywith 102“screen
2.5 m
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Convergence in practice: e.g. the Slingbox
Source: www.slingmedia.com
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What we thought user interfaces were going to be like 10years ago
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… and what we think today
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Established user interfaces tend to be very stable
Ford Model T, 1908
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The good old web browser (with AJAX, ofcourse): Here to stay?
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Innovation in mobile devices• Mobile devices already are:
– phone– calendar– e-mail client– browser– audio and video player– camera– watch– game console
• And will soon be:– TV– e-book and newspaper reading
device– payment device– scanner– GPS navigator– remote control– etc.
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Universal mobile devices: soon a full replacement forthe PC?
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A different approach...
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A model for the devices of the future?
• Does only one thing, but does it really well.• Is not perfect in every way, but
– very easy to use– tiny– beautiful
• Integrated into a much more complex system thatis more or less invisible for the user. It just works.– Online music shop with recommendationsà hypermediation
– DRM– Podcasts
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Other examples: all of them are market leaders
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Here and now: digital camera with built-in WiFi
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Summary
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To summarize...
• After years of crisis, momentum is back in the Internet:– New base technologies are ready for broader use:
AJAX, syndication, open APIs etc.– New forms of applications and business models are
being created every day– The speed of developments in network connectivity
and mobile devices is even increasing– Huge M&A deals are back:
Are we heading towards Bubble 2.0?
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Where are the biggest business opportunities?
• E-commerce and content for niche markets(„Long Tail“)
• For big players:open e-commerce infrastructure along the lines of Amazon.com
• Web-based applications, both for business and consumers
• Clever applications (and devices) for mobile use
• Tools to build all of this