BUSINESSWEEK ONLINE: DECEMBER 27, 1999 ISSUE

Technology & You

What Wonders Y2K Will Bring

At last it's here. After months of fear and loathing, Y2K is about to begin, and we'll find out how good a job we did in getting ready for it. I have always been upbeat about the ability of the high-tech world to cope with the new century, and recent news has all been positive. I expect the Great Rollover to pass with little more than annoying, but minor, problems--at least in the industrialized world.

With Y2K worries quickly fading, we can concentrate on the year ahead. I expect the next 12 months in the technology industry to be exciting, as befits the turn of the millennium. The Internet's amazingly rapid march from academic toy to mass medium will accelerate, simpler and more limited devices will make inroads on traditional PCs, and wireless communications will move further into the mainstream. PCs will get faster and a bit cheaper, but change will be relatively modest.

The World Wide Web will continue to dominate the high-tech story. The coming year will see the emergence of lots of ''information appliances''--devices simpler and perhaps less expensive than PCs that are intended to bring the Net to the two-thirds of U.S. households that don't have access to it now. The appliances are just starting to trickle to market, and many designs are little more than gleams in their developers' eyes. But the industry is betting that they are the wave of the future. Even Microsoft is pushing ''Web companions,'' which basically consist of a Web browser, an e-mail program, and nothing else, as an alternative to Windows PCs.

At the same time, cable modems and a high-speed phone service, called DSL (digital subscriber line), will make real progress in displacing slow and unreliable dial-up lines as the path from homes to the Net. It will still be three years to five years before broadband Internet access becomes pervasive. The process, however, is getting help from new, seemingly unrelated legislation that ends the prohibition on satellite broadcasters, such as DirecTV (GMH), carrying local stations. The ban on local broadcasts had given cable a big competitive advantage over satellites, and its repeal should spur the cable companies to promote another service that satellites can't: fast, always-on Internet access. The new aggressiveness by cable providers should, in turn, spur sluggish phone companies to speed the rollout of DSL--a win all around for consumers.

The Internet also will increasingly take to the air in 2000. Web-enabled wireless phones, which are becoming important tools in Europe and Asia, made their appearance in the U.S. in late 1999. Right now, they are mostly curiosities. It's cool to get instant stock quotes or a weather report on a wireless phone, but once the novelty wears off, you are left with the reality of a tiny display and horrible data entry. However, soon you'll see new services, such as trading and real-time traffic reports, that will be valuable enough to make a Web phone worth the trouble. In addition, there will be new handheld wireless devices (probably including a 3Com Palm with a color display.) And by late in the year, we'll see a new wireless technology called Bluetooth that lets all of your portable devices communicate with each other.

BLAZING LAPTOPS. By comparison, conventional desktop and laptop PCs seem a bit dull. On Feb. 17, Microsoft (MSFT) will finally release Windows 2000, its much delayed successor to Windows NT. Initially, at least, this is a development mainly of interest to business users. By the end of the year, Microsoft also plans to issue a successor to Windows 98. This package, code-named Millennium, will focus on ease of use and is being designed around a Microsoft-Intel standard called Easy PC. But I'll bet that late next year, I'll be talking about Millennium as big news for 2001.

In hardware, the story will be speed and more speed. Laptops will debut in January with Pentium IIIs that run at up to 700 MHZ when connected to AC power. By year's end, Intel Corp. (INTC) and Advanced Micro Devices Inc. (AMD) will be racing to bring out the first 1 gigahertz desktop chip. The bad news is that component shortages are likely to keep prices firm, especially for laptops, through the first half of the year.

I would like to take this occasion to thank you all for your readership, your support, your suggestions, even for the occasional flame. I wish everyone a happy and prosperous 2000--and may all your Y2K glitches be little ones.

Questions? Comments? E-mail tech&you@businessweek.com or fax (202) 383-2125

By STEPHEN H. WILDSTROM





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