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The Internet: more than we can imagine.

"I can do what?" Take it from the guru of Internet technology at IBM: We won't recognize ourselves in a few years.

Okay, what's really going on with the Internet? At the highest level, it's fairly simple: We've just begun. Sure, when you're exchanging web site addresses at the watercooler, it seems everybody is connected to the Internet, but in reality, the number of people hooked up right now, as a percentage of the world's population, rounds off to zero. Yes, zero. In effect, nobody is connected.

So how do you take advantage of that fact? How do you thrive in this exciting world we're moving in to? First and foremost, start simple. The Internet isn't something to study; it's something to do. There's nothing wrong with having a grand plan, but implementing it may be impossible, because while you're wrapped up in the implementation, your competition is moving very rapidly ahead of you.

It's much better to work from the outside in. Remember, that's where all the people are, and they're the ones with the power. Get connected with those people. Then work your way back in through bridges, connectors and gateways to existing applications. You can re-engineer the applications when you get a chance, but don't insist you do that first.

Build on a framework. Web sites today are mainstream, and the design of these sites is just as critical as the most important, most sophisticated systems in existence. They need to be [inches]7 x 24[inches] (supported seven days a week, 24 hours a day), reliable, available, secure and manageable, because things do go wrong. And companies need to be able to manage through the problems. In large companies today, if an application hiccups, somebody's pager goes off. That same discipline and architectural approach must be applied to the web. The days of surfing around for enjoyment are gone. This is serious stuff.

Here are the hot buttons.

* Instant messaging

Instant messaging is the concept of having a "buddy" list of people, whether they're part of your company, part of your family or part of an outside organization, whose names are on your screen. If a name is highlighted, that means that person is connected to the Internet right now, somewhere. You may not know where they are, but they're connected. So if you click on the name and type a message, that person gets the message immediately. It's not e-mail, and it doesn't replace e-mail. It's a supplement to e-mail, a new way of leveraging communications and a very quick, efficient way to ask a question and get an answer.

Today, tens of millions of people - most of them 15 or 16 years old use instant messaging. But this concept is moving inside all kinds of organizations, and it's having a profound impact on how people work together.

* Habla Espanol?

Another innovation that's potentially profound for business is language-translation technology, especially when you need to reach across cultural boundaries. For instance, there are prototypes of technology that allow me to type a question in English to a colleague in Spain and my message automatically will translate to Spanish; when the reply, in Spanish, comes back to me, it will appear in English. What's more, if you use text-to-speech technology, the messages will be translated and played back in the appropriate language.

Think about the potential of this technology in a customer-service environment. You'll be able to ask a question in your language and have the person most knowledgeable about that question hear it and answer it in his language. It offers a tremendous opportunity to break down cultural and language barriers in the commercial or educational world.

* Kids

Children are playing an interesting part in the technology phenomenon, too. Look at Lego, a company that's been around for many years creating little pieces of plastic that snap together to make different objects. Now, inside one of those little pieces of plastic is a computer that can store five programs. Each program has multi-processing capabilities. It can sense light, sense motion and be programmed to react in certain ways. Kids of all ages are experimenting with this new technology.

Think of the implications of children growing up interacting with technology of this type. Their expectations are expanding rapidly. They know what's possible. They've mastered the video games. They take for granted this world of interaction.

So what kind of e-business applications will today's children expect? Can you imagine teenagers five years from now going to the branch office of any kind of company, sitting down and filling out a three-part form to enroll in something? It won't happen.

* Reading, writing ...

In the educational arena, profound changes also are happening, although they may not be so obvious. Take, for instance, a group of four universities - in England, Korea, Mexico and Canada - that collectively have 400,000 students and 10,000 faculty members on 80 campuses. They offer a wide range of courses onsite, but they've just implemented "distributed learning" on the web and in so doing have grown their course offerings by 20 percent. Soon they believe they'll be able to reach about one million students. That's profound.

* E-business

Unlike the way in which many people approach it, electronic business is not about click-hereto-buy. E-business is about click-here-to-initiate-the-supply-chain, click-here-to-start-just-in-time inventory-flow-between-Company-A-and-Company-B, click-here-to-let-a-new-employee-step-through-the -orientation-process.

This evolution of e-business is happening across many dimensions. Millions of "Main Street" businesses will be springing up, because the cost to start an e-business is low and it can easily reach markets all over the world. One entrepreneur set up a health and fitness web site, where visitors can develop customized exercise and nutrition programs. It's the ultimate in one-to-one marketing: You go to a web site and specify, for instance, your own health needs and lifestyle and then have a vitamin prescribed exactly for you.

What about mainstream businesses, the companies we grew up with? The popular press sometimes gives the impression that only new companies will thrive, that the companies that already exist will just go away. I disagree. The tremendous resources of major companies are now moving very rapidly to make these household names effective e-businesses.

The ratio of business-to-business to business-to-consumer commerce on the web is hard to measure, but business-to-business probably will continue to be five to 10 times larger than business-to-consumer, albeit business-to-consumer is more visible to us as individuals.

One example is in a two-year-old company called Intralinks. This little startup syndicates loans. If a very large bank has a request from a company to borrow, say, a couple of hundred million dollars, the bank will post the details of the loan on the Intralinks' site. Hundreds of other banks can then go to the web site, learn about the loan and click to participate.

It's a very secure site; everything is encrypted. It has very granular security, so views of the loans are available to only the appropriate people. When a loan syndication starts, the financial analysts, administrators, attorneys and bankers all work together in a managed flow collaborating on this loan. When it's time to close the loan, there are no phone calls or faxes or briefcases full of closing documents to sign. Signatures are handled digitally in an encrypted environment. At last count, this behind-the-scenes little company had closed a little less than $150 billion of loans. That's the power of business-to-business on the Internet.

* Infrastructure

If there will be literally millions of e-businesses in the near future, as I believe, can the Internet handle it? Will we ever have the bandwidth in our homes that can meet our needs? The answer is unequivocally yes. And the reasons are very simple: competition and technology. Today, there are many ways to get bandwidth into the home, such as through cable modems, existing telephone wiring using a new technology called digital subscriber lines (which has the potential to handle tens of millions of bits per second), satellites, wireless, cellular, LNDS - each in some way threatening the other and causing leap-frogging to occur. Nothing is better than living somewhere where you see this competition.

Couple this with wide-scale caching, buffering and local storage of content. That green box that's on the telephone pole outside your home may have a smart disk drive in it. ISPs (integrated service providers) will install large caching servers with hierarchical storage-management capabilities so content can be distributed throughout the network around the world, perhaps broadcasting on a period basis from satellites.

With all this connectivity into homes and businesses, can the backbone handle it? Think of the 288 modem as a benchmark. If that's equivalent to a garden hose that's one inch in diameter bringing information into and taking information out of your home, that one-inch garden hose will expand to three feet through digital subscriber lines, or DSL, and through wide-band capabilities that soon will be available in many homes.

Fiber optic technology is a player, too - and it's far more powerful than we realize. We used to think of fiber as a strand of glass. You'd shine a light through the strand, and that's a one; you'd turn the light off, and that's a zero. That's how we transmitted information. Today, that single strand is being opened into 16 windows. Through each window we can shine a separate light, each a different color. Soon that 16 may increase to 40, and the 40 may increase to 100. We already see the potential for 100 streams of light going through that single fiber, perhaps 48 fibers in a single conduit and thousands of miles of conduits laid all over the world. This isn't an American phenomenon, either. It's happening in Europe and in Asia. In fact, in Singapore, there's fiber to the curb in residential neighborhoods.

* Telephones and video

You don't hear people joking about the quality of Internet telephony any more. Both telephony and video are becoming real. It doesn't take that much bandwidth to offer high-quality telephony over the Internet. And as we begin to introduce new standards that allow you to distinguish between a packet that's part of an important business-video conference and one that's part of an e-mail, the e-mail packets can be shifted into the slow lane of the information highway, while the business-video conference packets move into the fast lane and accelerate through the network. The standards for this important work, called DTSR, or differentiated services, are nearing completion now.

* Always on

Say you're going to Toronto tomorrow and you decide you'd like to know the weather there. If you're sitting in your chair at home, would you go over to your PC, dial your service provider, wait for the whirring of the modem, connect to the Internet, then go to some web site to check the weather? Probably not, unless you're planning to visit another web site at the same time.

If, on the other hand, your Internet is always on - so you simply have to click the mouse at your weather icon - you may think quite differently about it. As people have more and more cable modems, digital subscriber lines and wireless capabilities that are continuously on, the propensity to use the Internet will increase. This will greatly change the way we live and work over the next couple of years.

* Power to the people

The Internet is all about people and the power of the click of a mouse. It isn't about power to big companies or big governments; it's about power to you and me. We'll decide what we're interested in, when we're interested in it and how much we want to explore it.

Editors will continue to offer the very valuable service of providing a point of view. But you and I will decide whether we want to read the headline, the short form of the story or all of the story. We'll decide if we want to hear Elton John sing "Candle in the Wind" again. If we want to find out the temperature on the solar panels of the latest mission in outer space, we'll check it out - right now. If we want to open a bank account at 3 o'clock in the morning, that's when we'll open a bank account - and we'll decide the hours of operation. If we want to enroll in a new MBA course, we'll do it based on our schedule, not on any course catalogue.

Organizations that aren't in denial about this decision-making shift, and who instead see it as a powerful phenomenon, will capitalize on it. No more web pages that say, "If you want additional information, please call us Monday to Friday from 9:00 a.m. to 5:00 p.m., our business hours."

One click/one vote also will change the level of participation in governments around the world. People will be empowered to express their opinions and get involved in the government decisions they think are important.

* Access

The Internet will offer ubiquitous access. And people will decide how they connect. Today, virtually everyone connects to the Internet with a PC. I believe, in as few as three years, the PC will be the minority device on the Internet. Some people will prefer to view Internet pages on their television. Other people will choose to view that same web page reformatted onto their pager.

Still others will want to view the Internet on their palm computers or electronic work pads, complete with wireless adapters. In fact, this already is available in many parts of the world. And others will choose to access web pages through their telephones.

Some people will prefer to go to kiosks. Indeed, I believe very many people - those who don't want to own any of these electronic devices or who have only an occasional reason to get information from the Internet - will use kiosks. In France, it was just announced that 1,000 interactive kiosks are being developed to be deployed this year. Korea announced a similar program a couple of months ago. And you already can see them in the airport in San Francisco. So kiosks will emerge as an important connection to the web.

And, of course, some people will prefer to use all of these access devices.

* Digital IDs

Digital identifications are important for companies to truly realize the potential of the web. In my opinion, this technology needs to move faster. Today, you probably have a different log-in and password for every web site you visit. What's the answer? You could create a single log-in that works everywhere, but that's hard to execute and, if you end up dealing with some unscrupulous web site, you may have compromised your ID everywhere. Or you could make a list of all your different log-ins, but then where do you securely keep the list, and what if you lose it?

The answer is a digital ID, which can be stored in your smart card or on another physical device, plus a biometric, which is unique to you. The biometric could be a scan of your retina, your fingerprint, your voice print, your face print. The combination of the biometric and the digital ID creates a very unique label.

Then you can enter a single log-in and a password that doesn't go across the Internet in the clear. It goes only to your smart card or your hard disk and unlocks the digital certificate that contains your digital ID. In effect, it empowers your digital ID to negotiate for you with a server, to establish that the server actually is run by the organization it says runs it and, in turn, enables the server to know you really are who you say you are.

This unleashes some tremendously powerful capabilities. Now you have the ability, as a business, to provide authorization. For example, one person can view one set of information; another person gets a different view. One person is allowed to trade on margin; another person isn't.

And you achieve confidentiality. Today, people blindly send billions of e-mail messages every day - sometimes incredibly sensitive information. It's like writing something on a postcard and dropping it in a mailbox. You have no idea who's going to read it. But with a public key infrastructure, if you have the public key of the intended recipient, you can encrypt the message, to be decrypted only with the individual's private key.

You also achieve integrity of communications, because you can be sure, through this process, that the message wasn't altered.

Finally, you get non-repudiation, which means you can't place an order and later claim you didn't order it.

The problem is we don't need just one public key infrastructure; we need many. Some governments may offer IDs - and many people will prefer to get their ID from that source. Other people, possibly distrustful of the government, will prefer to get their IDs from a private company or perhaps a not-for-profit company. I believe we'll see many variations on the digital ID delivery method, but the bottom line is we must move forward as an industry to embrace and to implement this infrastructure.

* Killer applications

Okay, what will be some of the strongest, boldest, smartest uses of the Internet in the future?

Killer application #1: achieving insight. The connection of all kinds of devices - including cars, appliances, even vending machines - means an explosion of data. So how do we translate that data into information and then translate that information into insight, insight that allows us to gain business or educational advantages? The answer is deep computing, giving us the ability to analyze data - without even knowing what questions to ask - and to find patterns among information.

Large retail organizations have been using this concept to discover things like this: When men buy diapers, they buy beer. We may not know why, but if it's true, then put the beer next to the diapers. That's insight.

Killer application #2: electronic meetings. Instant messaging is the tip of the iceberg. It's a great way to communicate, and you can use that capability to send a URL (or Internet address) to a person to set up a meeting. Just tell the person to click on the URL you just sent, and when he does, up comes a white board. The board is for application sharing, It also allows many people, located anywhere, to participate and interact with this information.

Merging Internet telephony into this world of e-meetings, you can imagine how instant messaging will become like an intercom, by which you can talk to people as well as share applications.

Killer application #3: collaborative design. With the higher bandwidth that's on the horizon, an engineer will be able to hold a physical object in his hand, rotating and changing it, while a person 5,000 miles away sees and feels what the engineer is seeing and feeling.

Killer application #4: functional magnetic resonance imaging, or MRI. This is a relatively new and very fascinating area. Unlike the traditional MRI, which is when you're placed in one of those large machines and someone takes a picture of, say, your knee - much like an x-ray - functional MRI is when you're in that machine and a doctor tells you to bend your knee while he watches how your brain changes - and that doctor could be 5,000 miles away.

* Public policy

As the Internet evolves, public policy plays a role, but there are many issues here and little time to deliberate. One key: It's very important to anticipate what's coming next. For instance, couldn't we have anticipated the issues of content and privacy we're confronting today in America, Canada, Europe and Asia?

We actually have very good technology to deal with many of these concerns. Look at PICS, or the platform for Internet content selection. It's a very sophisticated protocol that enables sites to self-rate or to use proxies to do the rating for them. This, in turn, allows, say, parents to choose appropriate software on the PC or to use a label bureau that goes to a proxy to determine which sites are good or bad. And the parents will be able to pick the proxy. For instance, one person may choose the Christian Coalition. Another may choose the Cleveland PTA. Still another may choose Walt Disney or Betty Crocker. It's your choice.

There are good technical answers to many of these issues. We just need to anticipate them and have aggressive, private-sector leadership to address the problems, so we don't have to resort to regulation.

Currently, in America alone, more than 100 bills are pending that will in some way regulate the Internet. Of course, regulating the Internet is like regulating the wind, but that won't stop the political pressure if businesses and individuals don't move forward.

* Culture club

Get a taste of Interact culture. I still recommend this, even after we've all pretty much bought into the Internet. We still need to watch those expectations; we need to listen to kids and ask them what they think of applications. And listen acutely to people in your organization who think outside the box (and that doesn't mean you have to put them in charge of the project).

Listen to older people, too. I recently met several members of a retirement community who had formed a computer club. The club has 310 members, and the village's average age is 74. The club's motto? "Keeping pace in cyberspace." At their age, 50 percent of online users have bought something on the Internet, and 50 percent have invested via the Internet. They generally have money and they have time. They're a tremendous resource, so don't ignore them.

John Patrick is vice president of Internet technology for iBM Corporation. Visit his web page at www.ibm.com/patrick. As IBM's chief Internet technology officer, Patrick leads the company's efforts to create innovative technologies that will web-enable computer users worldwide. Patrick has been with IBM for 31 years and was responsible for creating the Think Pad brand.

This article was adapted from Patrick's presentation at FEI's Forum on Finance and Technology in March of 1999.
COPYRIGHT 1999 Financial Executives International
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1999, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:business use of Internet
Author:Partick, John
Publication:Financial Executive
Article Type:Cover Story
Date:May 1, 1999
Words:3678
Previous Article:Agreeing to disagree: challenging the CEO.
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