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tw · 06-20-2001, 02:19 PM

Warning: a long and rambling overview of the current economic expectations-

Ten years ago, there appeared to be no end to the growth of a computer industry. First (pre-IBM) PCs liberated computers from the big, centralized, 'we know what you need' MBA like bureaucracies. Then came graphical interfaces, a free-market attitude change where competitors cooperated as well as competed, where cloning was encouraged, where upstarts could thrive, where standardized foundations permitted the many to concentrate and learn on optimized platforms - hardware and software, then local networking quickly followed by the Internet, and open access all driven by new advertising based business models.

Things have sharply changed. Like the VCR market that saturated, so has the computer industry. Five years ago, the Internet was just the latest in new hot products. Computers were replaced in the home because they obsoleted before they required replacement. The current market growth can only be maintained if the next new technology arrives. So what is it?

The industry knew what came next. Five years ago, the next step was clearly identified as multi-media. Massive bandwidth, computing power, upgraded architectures and busses, simplified peripherals all would be required for this next step, and Gighertz CPUs. We have seen it all either in progress or currently existing. So where is the next wave in computing?

As part of the program, fiber optic giants installed massive networks - over $60 billion of fiber optic backbone carries new technologies such as ATM. IP Version 6 was established. Northern Telecom even changed to Nortel Networks. At any time at least 6 new fiber optics were being strung throughout the Pacific. IP telephone, video and audio conferencing standards were created. The PC architecture by Intel was optimized for multitasking multimedia - only to have AMD take market share by selling legacy optimized hardware. Why did the future not happen?

Everyone assumed their future strategic partners would also be ready for the next wave. Early to see the problem were Intel, Cisco, Microsoft, and Compaq who all but sued the one industry that feared innovation. It's called the 'last mile' now for a new reason. All but the last mile was installed. We are still stuck with a 56K world.

So much fiber optic were installed for this new wave that Merril Lynch estimates only 2.6 percent of the network is actually being used. Much is now estimated to never be used. In one completed Level 3 line, only 2 of 96 fibers is actually light. So much fiber was installed in the US that fiber would probably encircle the world 1700 times. And yet we are still stuck with POTS.

Qwest saw the problem and tried to address it. Qwest purchased US West and will now try to integrate all this capacity into supplying the last mile. AT&T so mismanaged their business that they will abandon long distance (already a big loser for them even though they can charge over $.10 per minute on calls that should only cost them about $0.002 per minute). But AT&T discovered they had bought into a disaster - the cable industry. AT&T is living a Reagonomics sort of existance having incurred $80billion debt alone!

That last mile is not available either from the Baby Bells or from the cable companies and will not be ubiquitous for at least another 5 years. In short, the computer industry has saturated current markets and cannot cash in on the next wave - multimedia.

The Economist noted that only 7% of companies are responsible for the past decade boom. If one industry stumbles, then where is the next innovation to pick up the pieces - to continue the economic run?

Cell phones: Nokia has annual sales of 100 million, followed by 180 million, then 250 million, then 400 million - followed by a prediction of only 400 million. Another market saturated since third generation phones are just not happening.

TVs: DTV would have been a boom buisness had the industry developed a better standard. Instead it costs too much, is not easy to receive, and does not have a killer application or market champ (as NBC did for color TV).

Let's see. Chrysler has been decimated by Daimler. Ford under Jacque Nasser has seen productivity fall to GM's levels - some of the industries lowest. Forget the auto industry.

USX and Bethlehem Steel are leading a continued downsizing is basic industrial materials.

Having consolidated much of the aerospace industry, Boeing is learning how unproductive companies such as MacDonald Douglas was. The US leader in rocket launchers has completed new rockets that, we know discover, still are not competitive to the world - especially against the French Arianne. The MacDonald Douglas commerical planes are basically a total loss. Their Apache contracts should have been suspended until this chopper can fly in combat. The next wave in satellite communications - sat phones and Internet access - has completely dissolved. In short the American aerospace business has major problems.

Environmental industries had been a plus for America when America was lead by people with appreciation of science. But when Reagan stopped such progress, then the Germans became world leaders in environmental control equipment. American again had oppurtunity for a new boom industry - except our genius President, without even one science advisor, decided that global warming would only cost America jobs. Of course he would think that. Our genius president is an MBA and therefore does not realize that jobs are only created by innovation. Forget a booom in environmental controls and staggering innovations in energy efficiency. The genius has pretty much suspemded an economic boom in energy and environmental development industries.

Products from advanced physics - forget it. Any new and major research tool is dead under the Republicans and an MBA president who sees short term glory in a useless space station but nothing is particle physics. A president who will waste massive capital on short term nuclear projects without considering long term costs (ie a nuclear power plants costs about as much to decommission as it does to commission - but power companies don't have to put up a bond to guarantee the decommissioning will be accomplished without government funds) (ie. Yucca Flats and waster fuel storage).

Home appliances - nothing but a steady demand since no breakthrough innovation is in the innovation pipeline.

Superconductors - after a major breakthrough in high temperature devices, little else to make it any different from the late 1950 semiconductor industry - with growth rates about equal to that 1950 industry.

Genetics, especially farming, is a possible new growth area except that heretics - poeple who talk like the pope that censured Galileo - are trying to stifle that business. See Europe as example.

The American economy is solid. There is continuing demand for many of the benchmarks of increased standards of living. Many overseas countries are still slowly picking up the pieces of their economy. But as in the Japanese economy, the American economy is also beginning to show signs of a shortage of innovation.

Massive money was wasted in so many ventures (possibly approaching one $trillion) from fiber optics to new satellite networks (Irridium and at least two others), the dot coms, and numerous corporate mergers. This is all money that will suddenly appear missing in the future when profits should have been realized. This is not rationalization for a recession. We should just realize that so many technologies stifled by MBAs of the 1970 and 1980 have finally been recovered, developed, marketed, and ubiquitously available. The resulting boom is over because so many stifled technologies have finally been released to markets. Welcome back to realty. Even gasoline prices are finally rising back to normal levels.

IOW, what promised to be the driving economic force of 2000s will not happen even though almost everything is there - except the last mile. There is little demand for all those new servers, all that fiber optic switching equipment, conferencing hardware and software, networked appliances, or even the 1.3 Gigahetz processor - when the last mile does not exist to justify all this equipment.

How can the computer industry growth continue when a 486-66 Mhz processor is still sufficient for almost all current Internet activity? That last mile has stifled new demands in so many industries.

06-20-2001, 02:19 PM	#1
tw Read? I only know how to write. Join Date: Jan 2001 Posts: 11,933	Warning: a long and rambling overview of the current economic expectations- Ten years ago, there appeared to be no end to the growth of a computer industry. First (pre-IBM) PCs liberated computers from the big, centralized, 'we know what you need' MBA like bureaucracies. Then came graphical interfaces, a free-market attitude change where competitors cooperated as well as competed, where cloning was encouraged, where upstarts could thrive, where standardized foundations permitted the many to concentrate and learn on optimized platforms - hardware and software, then local networking quickly followed by the Internet, and open access all driven by new advertising based business models. Things have sharply changed. Like the VCR market that saturated, so has the computer industry. Five years ago, the Internet was just the latest in new hot products. Computers were replaced in the home because they obsoleted before they required replacement. The current market growth can only be maintained if the next new technology arrives. So what is it? The industry knew what came next. Five years ago, the next step was clearly identified as multi-media. Massive bandwidth, computing power, upgraded architectures and busses, simplified peripherals all would be required for this next step, and Gighertz CPUs. We have seen it all either in progress or currently existing. So where is the next wave in computing? As part of the program, fiber optic giants installed massive networks - over $60 billion of fiber optic backbone carries new technologies such as ATM. IP Version 6 was established. Northern Telecom even changed to Nortel Networks. At any time at least 6 new fiber optics were being strung throughout the Pacific. IP telephone, video and audio conferencing standards were created. The PC architecture by Intel was optimized for multitasking multimedia - only to have AMD take market share by selling legacy optimized hardware. Why did the future not happen? Everyone assumed their future strategic partners would also be ready for the next wave. Early to see the problem were Intel, Cisco, Microsoft, and Compaq who all but sued the one industry that feared innovation. It's called the 'last mile' now for a new reason. All but the last mile was installed. We are still stuck with a 56K world. So much fiber optic were installed for this new wave that Merril Lynch estimates only 2.6 percent of the network is actually being used. Much is now estimated to never be used. In one completed Level 3 line, only 2 of 96 fibers is actually light. So much fiber was installed in the US that fiber would probably encircle the world 1700 times. And yet we are still stuck with POTS. Qwest saw the problem and tried to address it. Qwest purchased US West and will now try to integrate all this capacity into supplying the last mile. AT&T so mismanaged their business that they will abandon long distance (already a big loser for them even though they can charge over $.10 per minute on calls that should only cost them about $0.002 per minute). But AT&T discovered they had bought into a disaster - the cable industry. AT&T is living a Reagonomics sort of existance having incurred $80billion debt alone! That last mile is not available either from the Baby Bells or from the cable companies and will not be ubiquitous for at least another 5 years. In short, the computer industry has saturated current markets and cannot cash in on the next wave - multimedia. The Economist noted that only 7% of companies are responsible for the past decade boom. If one industry stumbles, then where is the next innovation to pick up the pieces - to continue the economic run? Cell phones: Nokia has annual sales of 100 million, followed by 180 million, then 250 million, then 400 million - followed by a prediction of only 400 million. Another market saturated since third generation phones are just not happening. TVs: DTV would have been a boom buisness had the industry developed a better standard. Instead it costs too much, is not easy to receive, and does not have a killer application or market champ (as NBC did for color TV). Let's see. Chrysler has been decimated by Daimler. Ford under Jacque Nasser has seen productivity fall to GM's levels - some of the industries lowest. Forget the auto industry. USX and Bethlehem Steel are leading a continued downsizing is basic industrial materials. Having consolidated much of the aerospace industry, Boeing is learning how unproductive companies such as MacDonald Douglas was. The US leader in rocket launchers has completed new rockets that, we know discover, still are not competitive to the world - especially against the French Arianne. The MacDonald Douglas commerical planes are basically a total loss. Their Apache contracts should have been suspended until this chopper can fly in combat. The next wave in satellite communications - sat phones and Internet access - has completely dissolved. In short the American aerospace business has major problems. Environmental industries had been a plus for America when America was lead by people with appreciation of science. But when Reagan stopped such progress, then the Germans became world leaders in environmental control equipment. American again had oppurtunity for a new boom industry - except our genius President, without even one science advisor, decided that global warming would only cost America jobs. Of course he would think that. Our genius president is an MBA and therefore does not realize that jobs are only created by innovation. Forget a booom in environmental controls and staggering innovations in energy efficiency. The genius has pretty much suspemded an economic boom in energy and environmental development industries. Products from advanced physics - forget it. Any new and major research tool is dead under the Republicans and an MBA president who sees short term glory in a useless space station but nothing is particle physics. A president who will waste massive capital on short term nuclear projects without considering long term costs (ie a nuclear power plants costs about as much to decommission as it does to commission - but power companies don't have to put up a bond to guarantee the decommissioning will be accomplished without government funds) (ie. Yucca Flats and waster fuel storage). Home appliances - nothing but a steady demand since no breakthrough innovation is in the innovation pipeline. Superconductors - after a major breakthrough in high temperature devices, little else to make it any different from the late 1950 semiconductor industry - with growth rates about equal to that 1950 industry. Genetics, especially farming, is a possible new growth area except that heretics - poeple who talk like the pope that censured Galileo - are trying to stifle that business. See Europe as example. The American economy is solid. There is continuing demand for many of the benchmarks of increased standards of living. Many overseas countries are still slowly picking up the pieces of their economy. But as in the Japanese economy, the American economy is also beginning to show signs of a shortage of innovation. Massive money was wasted in so many ventures (possibly approaching one $trillion) from fiber optics to new satellite networks (Irridium and at least two others), the dot coms, and numerous corporate mergers. This is all money that will suddenly appear missing in the future when profits should have been realized. This is not rationalization for a recession. We should just realize that so many technologies stifled by MBAs of the 1970 and 1980 have finally been recovered, developed, marketed, and ubiquitously available. The resulting boom is over because so many stifled technologies have finally been released to markets. Welcome back to realty. Even gasoline prices are finally rising back to normal levels. IOW, what promised to be the driving economic force of 2000s will not happen even though almost everything is there - except the last mile. There is little demand for all those new servers, all that fiber optic switching equipment, conferencing hardware and software, networked appliances, or even the 1.3 Gigahetz processor - when the last mile does not exist to justify all this equipment. How can the computer industry growth continue when a 486-66 Mhz processor is still sufficient for almost all current Internet activity? That last mile has stifled new demands in so many industries.