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Subject: Notes from the Networked Economy Conference held in Paris 20-21 May 97 From: marleen <marleen@waag.org> Date: Thu, 10 Jul 1997 11:15:45 METDST * * * * * From: chris@creanet.net Date: Sun, 6 Jul 1997 12:37:29 +0200 To: bandwidth@waag.org Subject: Networked Economy : notes on the telcos' delusion These are notes from a conference I attended in may. It was a paradoxically exciting conference, and having seen these telco-moguls (or almost so) and regulators drowning into confusion and regrets for their lost-empires was a true releaf and a cynical two days laugh. Virtually yours hybrid-space workers. Christine Treguier / Les Virtualistes ******************** Notes from the Networked Economy Conference held in Paris 20-21 May 97 Walter Catlow (Ameritech USA) described Ameritech's new interactive TV ChildTV says that their marketing guys were selling it doors to doors; the marketing argument beeing a dog in their pocket to seduce the clients ! He did not mentioned how the guys were handling the dog's shit inside the pocket. Maybe the dog is a new version of Bandai's Tamagushi. Round table : "Building the Infrastructure" The question is : Is technology radically transforming conomy or is economy going its way ? The fact that the telcos' economic curves are actually all going down would proove that the costs of infrastructures and their operating costs are all but going down due to technology. Question : are satellites and mobile services going to change the trend ? Apparently all futur-ex-telcos and new operators agree on the fact that their margins will severely narrow, eaten by the costs of infrastructure and ownership. Kevin Carton (Price Waterhouse) explained that the only constant was change, and they had to keep the pace. But he unfortunetalety had no real clue to expose to do so. Personnal question : Can any Moore Law be applied (or reverse-applied) to communication and the networks' costs ? During this roundtable many speakers mentionned the necessity of "restriction" : restriction of costs, of costs of ownership, of access to new services which overwhelmed the users and turn them into technology's slaves, restriction of quantity and therefore choice with filters like "push technology" (supposed to be an added value). A true paradox as networks' technology is supposed to widden the scope of communication and access to knowledge, and globally enhance the user's life and the operators' profits. It is now obvious that states and business actors want to take control over the Net to bend its developpemnt (in other words restrict it) to fit their interests, regardless to the users' ones. Lots of comments were given to Gates/Mc Caw Teledesic offensive which apparently frightens a number of regulators and operators, though whithout triggering any real action against it. One even said "never bet against Bill Gates." The conclusion of that first morning was given by one attendee who spoke about the "telcos sufferring from a delusion syndrom", and by Kevin Carton who announced the arrival of the "GLOMO" (global-mobile-executive) which we know already suffers from Datashock for which no vaccin has been invented yet. Long live to the GLOMO ! ******************** Afternoon sessions "Shaping the Networked Economy" Michael Storey (Worldcom) explained that Worldcom (ex MFS who bought UUNet in 96) whose plans are apparently to become the number one private operator, was going to launch a 486 Gigabits European Network and some translatlantic network. Internet is their spearhead, and media moguls will become their allies when they will realize how the infotainment-distribution extensions can benefit them. Herbert Ungerer (EC Belgium) believed in nothing but "only market forces". Sony's Yair Landau talked about content, saying in essence "we've got the rights" Bruno Lasserre (P&T and Foreign Affairs France) formerly in charge of deregulation affairs at EEC, insisted on regulation : if it is for quality, yes, if it is to interfere with politics, no. He would prefer actors to build and apply self-regulation, but if it cannot happen, then the states will have to do their job He is asking for the creation of a European Regulation Agency which would amongst other subjects, carefully scan the new satellites' projects. " Financing the Networked Economy" Andrew Harrington (Salomon Bros UK) talked about a 5th world industry, where returns on investment are no more local but global and where there is no predictibilty of revenus. Protected national markets are fragilized (understand going down) and second level operators are going up. Denis Gilhooly from Teledesic had obviously an intense pleasure deploying the Teledesic banner in front of a rather hostile table and audience. He gave precisions such as number of satellites (reduced from 640 to 320), set of frequencies secured ITU in 1995 (400Mhz range), FCC licensing, new partnership with Boeing. First launch are scheduled for 2002, and the estimated global cost is 9 billion $ (which is nothing compared with the 100 billions $ announced by NTT japan for their all-fiber-to-the-home project for 2010). The estimated cost of connection is 1$ per month. Other speaker argued that it will be closer to 3 to 5$. Questions are who is going to pay this price for mobile com, and even if there are clients, they will doubtedly be numerous enough to cover the investments in the next five years. ***************** Second day "Selling the Networked Economy" Comparing Internet with the incarnation of Mc Luhan's Global Village, Pekka Tarjane (ITU General Secretary) warned all the ones trying to "sell the NE (like Wired) that if it has to be a really global network aiming at more justice and democracy. He also compared the actual 300 million $ revenue of Net publicity to the 2 billions $ of TV publicity. He was apparently less optimistic than the White House who has just announced 5 to 10 billions $ estimated revenues for year 2000, seductive arguments to convince the rest of the world and specially european countries to jump in the american bandwagon. East Conquest is on, where are the indians ? Bruce Wilson (Cybercash) talked about disapearing geography (probably he is not taking into account the will for taxes of the still not burried states). He said that the losers will be the go-betweens, and those who own the physical channels cause they are to slow to adapt (hmm Darwin is not dead either). Bizzarely, France Telecom announced an agreement to use Cybercash for their Wanadoo Internet service. One can wonder why Cybercash as there is another succesful french system, called Klee-Line, which has been internationally licenced as one of the two official e-payment systems for e-commerce. Some rapid allegence to the King, probably. "Imagining the Networked Future" Peter Cochrane (BT - UK) , a truly british humorous guy, started with a strong statement : we are leaving hierarchy and structure for its contrary self organisation and chaos. Therefore, no one knows how to build the Global Infrastructure. GI is space, time and frequency/wavelength. Phone lines have a 6% growth, they are the host. Internet has a 90% growth, it is the parasite. Any parasite should let its host live, to prevent its own death. He mentionned the ever-growing cost of billing which is muffling the Telcos. He listed some possible directions : -information is lost in datas - money can be made on information, or rather on where is the information and how to extract it. - the machine is actually in charge of most of the communication's steps : dial, search, store etc... - video-conferencing with projection and eye-contact - telemedicine - portable technology (rings storing your ID, medical files etc...) Joseph De Foe (The Open Group- USA) gave Net's numbers : 20 millions hosts, 7O millions mail users, 21 millions web sites. He acknowledged there is NO killer app, only ordinary estimated niches like banking, entertainment, home shopping, personnel services. The business is small and large companies should behave according to new ecological models. Public Services and states should stick to democratic issues, healthcare and education. He claimed that Intranets were fragmenting the network and lower its value, and that the Pipeline problem (to be sure to get your communication after a dial) has to be solved. The final discussions concluded on two points : "We have to make Technology humane, and not the opposite". This is according to me a dangerous solution, as so called human, user-friendly systems make dumb and techno-illiterate users after a while (see car-owner behaviour when the car is broken). "Monopoles where is/was the most confortable situation (with regrets and a big sigh). " Yes indeed. But it's over now and we should urgently invent something else to oppose to "only market forces".