Digital Zoom

This is the 21st issue of the Top Twenty. For 21 straight years, the issue

has provided analysis and insight about the infotech industry. We are happy to

be presenting it once again. While you will find the data in this and three

subsequent issues, let me put down some thoughts that are not entirely data

based. Keep in mind that this is a digital zoom being applied and therefore the

detail level is a bit fuzzy.

n The Internet will see a

rebound. After the dotcom bust it went below the radar screens. Expect a solid

and mature return in terms of quantity and quality of connectivity and products

and services on offer.

n IT penetration in the SMB

market/medium sized towns will finally grow—and rapidly. The talk of this year

will change to action as vendors step up their market development efforts in

these untapped markets.

n The Home PC will be marketed as

an AFD—All Function Device. It will become the music player, jukebox, photo

album, alternate TV, communicator—all rolled in one. Intense competition will

force vendors to offer these and other add-ons with PCs.

n The Corporate PC will become

just another device-if it has not already become one. No frills. No bells and

whistles. Just essential stuff with a high premium on reliability and service.

Brand names will continue to be seen as being more reliable and offering better

service—sometimes erroneously.

n BPO will keep booming

regardless of the backlash. But look out for sell-offs to international

companies. A few players will find the lure of the dollar too tempting. Also

look out for more and more captive BPO outfits coming up. The industry will

grow, but it may not be 'Indian' companies that will lead the charge.

n BPO People issues are unlikely

to die down soon. While the attrition issue has been identified and analyzed,

the solutions are only being contemplated/discussed. It will take more time to

find lasting solutions.

n Music downloads of the unpaid

kind will continue unabated. Paid music downloads in India will happen, but like

waves in the backwaters. No major increase can be expected because Internet

access is low, there are few options, costs are high and download speeds are

low.

n Digital marketing will see a

growth. On line spend will creep up to 3% to 5% of total media spend. The growth

will be limited to a few areas—information dissemination, lead generation,

community building etc.

n Commercial messages on your

mobile phones will grow in the form of SMS and voice. The numbers may not be as

large as email spam, but could be enough to become irritants.

n Mobiles will also spread into

the countryside. Phase Two of the mobile revolution has already started and see

the momentum grow. Even with 36 million odd connections (and a 500% plus growth

rate) there is a huge potential waiting to be tapped. The limit is the speed at

which the infrastructure can be built up. Nothing else.

n E Commerce will grow in triple

digits— with the small base that exists, the absolute numbers will not be

earthshaking, but will boost confidence in the medium and open the portals for

explosive growths in subsequent years. The initial jump will happen in areas

like ticketing, banking, stocks, books, gadgets and other off the shelf standard

items.

n Do not expect any major relief

from spam and virus attacks. Better technology solutions will be found—but

will also be overcome by spammers with regularity. Spam will end only when its

cost becomes higher than the returns to the sender. Virus attacks at the rate of

one serious one every quarter will continue. There is no reason to believe that

the number of sick people who make and send viruses is decreasing. Fortunately

much of the stuff is harmless.

n The Outsourcing buzz will echo

in the domestic market too. Expect at least a dozen big deals to be finalized.

Expect some serious moves from the IT software companies to try and tap the

local market.

n Linux will grow—maybe 10% to

20 % installations will run on it. But do not expect it to displace the

competing environments completely. Coexistence will happen in practice. Maybe

denied in public by some vendors.

n Expect broadband connectivity

in homes and offices to move up. No quantum jumps here, but healthy growth that

is akin to revving up. Take off is a little distant. Broadband penetration is

driven by low costs and high bandwidth applications. The former are still high

and the latter still low.

n The wireless will start

becoming real. Concepts and standards will give way to products and services

based on wireless connectivity for computers and other electronic devices. This

is one set of products that offer so much convenience. As soon as the

availability and affordability improve—as they are showing signs off—expect

the market to zoom. If you do not believe that, please have a look at the

entangled backside of your computer just now.

n E-Governance will happen in

pockets where the governments are secure and committed enough to experiment with

technology-supported reforms. But the movement will be in fits and starts

without a universal momentum. Politicians will be looking over their shoulders

far too frequently to allow that.

n Intrusive marketing in the form

of tele-callers, pop up ads on the net and climax busters on television will

increase. Do not expect the irritation value of these to tire out marketers who

are desperate for innovation in increasingly competitive scenarios. The users of

this form of advertising may not be the technology companies, but they will

provide the required solutions.

n Search on the net will become a

paid proposition and a respectable revenue stream. Free search that returns more

junk then real data is a huge time guzzler and value for money alternatives will

have takers.

n Tech stocks will go up because

they are still the least susceptible to government interference. That is also a

prayer rather than a prediction.

The author is Editor-in-Chief of CyberMedia, the publishers of Dataquest. He

can be reached at Shyam

Malhotra