LIBERATION, COURTESY OF THE INTERNET
Ours is an era of revolutions: The collapse of communism. The economic rise of the Third World. The Information Age. Behind these upheavals lies an integrating idea: openness. It's time to open up, to "liberalize" everything, from national borders to shareholder reporting.
Now, the open standards of the Internet are rapidly transforming the computer business. Throughout the 1980s, the high-technology industry did an astounding job of bringing innovations to market at great speed, thanks to cutthroat competition between lots of hardware and software companies: IBM vs. Apple Computer, Intel vs. Motorola, Microsoft vs. everyone else.
Yet in the 1990s, the rules seemed to change. Microsoft was winning the lion's share of markets and profits, along with semiconductor goliath Intel--creating the so-called Wintel (Windows and Intel) standard. Microsoft's control of the personal-computer architecture has become so pervasive that government trustbusters, corporate customers, and industry rivals feared the company's near-monopoly position.
While such apprehensions were perhaps well-founded, they may become increasingly irrelevant. The open-system standards of the Internet and its World Wide Web are seeing to that. Just as IBM lost its near-monopoly in computers during the era of mainframes to nimbler PC visionaries, so the Internet threatens to overhaul the software business, creating a whole new set of winners and losers. On the World Wide Web, computer users with all kinds of systems easily communicate with one another. New programming setups that ride on the Web's open standards, such as Sun Microsystems' Java, promise to make it easy for diverse machines from various manufacturers to share the same software. With minimal barriers to entry, the Internet offers a software world where no one has seized control and where entrepreneurs can reach out to new customers without going through Microsoft or any other aspiring gatekeeper. Once again, as our Cover Story on software makes clear (page 78), competition and technology are the enemies of monopoly.
The tantalizing possibility--that software's current corporate hierarchy may be upset--isn't the most interesting part of the Internet story, however: It's the Internet's potential to lower the costs of information and distribution drastically, making American industry even more flexible and nimble. But realizing the wealth-creating potential of the Internet won't be just a tale of technology. It will also depend on organizational innovations and investments that will allow employees to exploit this frontier technology. It will require vigilance by customers to make sure computer and software makers stick with open standards.