The IP Revolution

There are many amazing aspects to the Internet and the whole IP Revolution. Let me quickly add that I don’t use the word "revolution" loosely or very often. In this industry in the last 20 years, we’ve had two revolutions, the only other one being the PC Revolution.

One of the most curious things to me about the Internet is that no one even came close to predicting its impact. Not International Data Corp., not Gartner Group, not Stephen Hawking, not even Vinton Cerf, the genius who wrote the IP protocol. No one.

I’ve asked very smart people why neither they nor anyone else saw the IP train coming. Their answer, quite consistently, is that the Internet is just part of what we collectively call the IP Revolution. It’s actually a three-headed creature that includes the Internet, the explosion of PCs in businesses and homes, and the metamorphosis of digital communications – which made the sending and fetching of data both cheaper and faster in a hurry.

These three factors joined together to form something no one had dreamed of. Now something else is forming: A mutation of the original three-headed beast. It is very similar in some regards, but vastly different in others.

Essentially the communications and network access piece of the IP Revolution will undergo radical, order-of-magnitude change in the next couple of years. What will happen is that home and remote office users will see Internet access speeds increased by 20 times or more. Until now, network access for most of these users has been governed by conventional modem speeds, and those have doubled roughly every three years. Now we’re facing a more than 20-fold increase virtually overnight, growing to a 100-fold increase by about 2005.

A combination of technologies will make this change possible, including cable modems, xDSL and wireless optics. Transmission prices will plummet as scores of suppliers invade the bandwidth market. And we’ll be asking, "What hath God wrought?"

The answer is order-of-magnitude changes to major industries that will rival the IP Revolution itself. Which industries and markets? All of them. Every single one, including yours.

Still in the early days of this second iteration of the IP Revolution, it is possible to look at some areas that have been, or are being, remade right before our eyes to get a glimpse of what the future might bring.

That’s the ticket. Online travel ticket sales of $2 billion this year will soar to $9 billion in four years. Expect the airlines to push very hard for even more, because online sales chop out 25 percent or more of the airlines’ marketing and sales costs. The unknown piece is the other services that airlines will attempt to pump through their Internet ticket windows. Surely all travel-related reservations, from restaurants to rental cars to inter-city transport, are candidates. What about entertainment? Automated babysitting arrangements when flights are delayed or canceled? Direct links to one’s online scheduler to rearrange appointments when delays crop up?

Banking on IT. Most home banking setups today are woefully primitive. In fact, most online services, like AOL, offer and permit far more financial services and transaction capabilities than what you can get from a major bank. I think part of the reason for this shortfall has been the banks’ preoccupation with digesting the huge mergers of the past five years. The basic economics driving online banking services are staggering. It costs 100 times more to process a transaction with a live teller than to do so online; more than 20 times more to process a transaction with an ATM than online. Cash-strapped by the costs of merging, banks will most assuredly commit massive resources to building fat pipelines to the home. No telling what they’ll fill them with.

Rx for success. Medicine and health care around the world are a mess. The cost of care is too high, and medical attention doesn’t reach many who need it. In addition, the practice of medicine still focuses more on care and treatment than prevention. The medical establishment at large, and we mortals by association, stand to benefit mightily by "IP medicine," such as delivering vital information, which currently is available only by pairing the care provider with the patient, right to the home, electronically. Vital signs monitored and relayed from the home to central sites; prescriptions automatically entered, filled and delivered; even life-saving advice dispensed with see-you, see-me IP-based technology.

The problem, or more accurately, the challenge, is this: No one out there today can say what those changes will be. That’s because the applications that will be developed to leverage the breaking of the bandwidth barricades have not been thought up yet, let alone brought to market. --Bill Laberis is president of Bill Laberis Associates Inc. (Holliston, Mass.) and former editor-in-chief of Computerworld. Contact him at