Year of Search

Occasionally we pundits hit the target. A year ago nearly everyone who

follows the technology industry predicted that 2004 would be the year that

digital entertainment really hit the consumer mainstream. The Apple iPod-driven

surge of downloaded music and an explosion of choice in digital televisions,

especially oversized flat panels, proved us right.

Looking ahead, 2005 increasingly appears to be the year the entertainment

industry will have to decide if it wants to ride this surging tide or continue

to fight it.

The outlook is mixed at best. For example, in 2005 film studios will finally

make high-definition movies available on DVD. But the huge file size of HD

content requires a new storage format-and new players.

For

the first time since VCRs arrived, consumers will see restrictions on what they

can do with the broadcast and cable content they receive, especially HD

programming. Regulations will require new TV receivers and other gear, including

TiVo-type recorders, to honor "flags" that limit whether a show can

be recorded and whether a recording can be copied to other media- such as a

DVD-or otherwise distributed. Broadcast rules allow at least one recording for

personal use and distribution of content within a home network. But cable

content, such as HBO programming, can be much more severely restricted,

including, at least in theory, a ban on recording.

The vigor of the new digital-entertainment media's blossoming will depend

on how restrictive content owners-mostly movie studios-are. Again, early

signs are not good for consumers. Studios are pushing to tighten limits on

copying and sharing content by lobbying the Federal Communications Commission,

pushing for new legislation, and pursuing a case before the US. Supreme Court.

On the IT side of the industry, 2005 promises to be the Year of Search. With

Web search services now an established and profitable business, extending search

to your own files and e-mail archives is the new frontier. Google made a test

version of its desktop search program available in early fall, Microsoft jumped

in with its version on December 13, and Yahoo! has announced plans to distribute

a free version of a search program called X1. Expect a proliferation of new

search services-Web and desktop, general and specialized-next year.

Unfortunately, various sorts of attacks on your computer are also bound to

proliferate. The assaults-increasingly the work of serious criminals rather

than thrill-seekers-are getting more sophisticated and dangerous and can lead

to the theft of valuable personal or business information. I hope more service

providers will follow the lead of America Online and take more direct

responsibility for the safety of customers. But in the meantime it's up to you

to protect yourself. Windows users: If you run XP and haven't upgraded Service

Pack 2, do so now, and make sure to keep your antivirus and antispyware software

up to date.

With diligence and some luck, you should enjoy a virus- and spyware-free

2004. I also want to thank all my readers for their support and wish you and

yours health, happiness, prosperity, and peace in the year to come.

in Business Week. Copyright 2005 by the

McGraw-Hill Companies, inc