BUSINESSWEEK ONLINE : MAY 22, 2000 ISSUE
INTERNATIONAL -- COVER STORY IBM's Mark Bregman: "The Immediacy of Data" Will Change How We Work Americans -- more than Europeans or Japanese -- have resisted the idea that souped-up cell phones and pocket computers could become primary vehicles for Internet access. But in recent months, top technology companies such as Intel, Cisco, Yahoo!, and Palm have rolled out major initiatives related to the wireless Web. IBM has put together a business division called Pervasive Computing, to tap into wireless technology and applications. Its general manager, Mark F. Bregman, spoke with Senior Writer Neil Gross for this week's special report: "Wireless in Cyberspace." Here are edited portions of that interview: Q: How did Pervasive Computing get started at IBM? A: It began in the research division about two and a half years ago. The idea was to peer into the future, about three years down the road and think about new trends. We recognized that there were a whole bunch of new devices coming out that won't be PCs and that would have a big impact. A few hundred million PCs sounds like a lot. But that's really a small number, compared to these new devices. I was charged with coming up with strategy for this area. Q: What were the challenges? A: Understanding convergence. We knew this would involve telecom -- wireless as well as wired -- information technology, consumer electronics, and entertainment all coming together. One thing we realized early on, as a core part of the strategy, was that this would not be pure IT and that it was not something we could do on our own. We would have to form "value webs" with players who are significant in other industries. Q: When did you start to get serious? A: In 1998, we started talking to telecom equipment manufacturers such as Nokia, Ericsson, Lucent, and others, as well as carriers. Then, at the Telecom '99 show in Geneva, this whole world of mobile e-business really seemed to take off. A year ago, I believed that the U.S. was 18 months to two years behind Europe in the mobile Web. But a lot of people woke up. Now, I'd say that U.S. carriers are six to nine months behind Europe. Q: Tell me about IBM's alliance with Sprint PCS? A: We started talking with Sprint about 18 months ago. It was still something they thought about as the future. In the last year, they got religion. Sprint realized that the wireless Web is not just about consumers checking sports scores. It's about enterprise business over wireless. We found that we had real synergy. We have knowledge and access to enterprise customers. They understand wireless technology, how to make the wireless Web work. But Sprint understands that our arrangement is not exclusive. We're also working with AT&T Wireless and others of the top 16 carriers. Q: What are the enterprise applications here? A: With any new medium, people project their experience with the current generation. They're always wrong. You never could have guessed what cell phones would become, based on the first generation, with its bad connections, lost calls, and poor sound quality. What we know is that the immediacy of data is important. You can see that with UPS and Fedex, which use wireless devices to track parcels straight to the door. That's real value. Think of what happened to the companies who spent money reengineering their business processes and installing enterprise resource planning software. Suddenly, they could check orders while sitting at the desk. Well imagine what will happen when you can make that information available to people in the field. We're building apps that will give them access to corporate data on Palm devices or smart phones. You can get updates during the day on service calls you have to make, on the status of the customer, on parts available in stock. Those kinds of thing all lubricate business and make it more efficient. Q: What's in the pipeline with Sprint? A: The main thing will be a set of offerings to help enterprises extend their reach, with the first real apps coming out this year. There are a couple of big pilots. One is for the insurance sector, where salesmen can check premiums in real time, on the fly. People won't want to download a whole application to the phone. They'll build extensions, so they can just pull in the key part of the app. Q: What do you think of the claims about third-generation cell phones, that they will be able to surf the Net at two megabits per second? A: There will be some capability for that, but it would be expensive if you tried to use it that way. Here's the thing to keep in mind about "3G" phones: This is a major step forward, and it will make the wireless Internet real. But it won't be the same kind of thing you get with broadband on optical fiber. You won't do video-on-demand and watch 90-minute movies on your phone. If you did that, it would tie up some significant portion of the cellular spectrum. It's technically possible, but you could never afford to do it. Q: Will anyone use expensive video services on phones? A: There are some situations where you might. If you are insurance agent at the scene of a crash, and you need to send some clips, it might be worth the extra bucks. A lot of this will depend on the economic threshold. But it will be different from the wired Web, where a lot of applications are driven by the perception that it is free. I can point a camera at my driveway and post images on the Web. That's low value, but it's also low cost. Wireless is different, because spectrum is scarce. Once things cost money, people will make real value decisions. Q: So what is the real potential of the wireless Web? A: I'll go out on a limb here: This is going to be a very big thing. I can't say what the big application will be. Whatever we say it's going to be, it will probably be something else. But the technology is too compelling. People are going to use it. Wireless will change our expectations of immediacy and convenience. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS Wireless in Cyberspace (int'l edition) INT'L COVER IMAGE: Wireless in Cyberspace TABLE: The Clash of the Wireless Titans Begins CHART: Across the Globe, Demand for Digital Cell Phones Is Soaring Japan's Cutting Edge (int'l edition) CHART: Japanese Internet, Cellular, and Wireless Net Users Goliath vs. Goliath (int'l edition) CHART: Western European Internet, Cellular, and Wireless Net Users Sprint's a Web Evangelist (int'l edition) CHART: Total Internet, Cellular, and Wireless Net Users in North America China Surfing (int'l edition) CHART: Asia-Pacific Internet, Cellular, and Wireless Net Users Commentary: Yes, It Really Is the Next Big Thing (int'l edition) ONLINE ORIGINAL: IBM's Mark Bregman: "The Immediacy of Data" Will Change How We Work ONLINE ORIGINAL: Let a Million WAP Users Bloom ONLINE ORIGINAL: Matsushita's Takashi Kawada: "All We Have Is a Little Time Advantage" BW E.BIZ: "Martin Cooper: A Wireless Prophet Who's Pushing 'Smart Antennas'" INTERACT E-Mail to Business Week Online

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