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Visions of '04 start at the digital kiosk


Source: The Washington Post
By Leslie Walker
Date: January 03, 2004

While many people kick off the new year counting calories, technology writers feel compelled to spend the first day of every year guessing what will unfold for information tech during the remaining 364 days. We pretend we are peering into the future, though we know the crystal ball typically reflects the past.

Yet I couldnít resist a peek.

-- Digital music rocks: The digital music battleground moves out of the Internetís back alleys and into the mainstream of e-commerce as scores of companies -- including Wal-Mart, Best Buy, Microsoft, Dell, loads of record stores and even unlikely players such as Coca-Cola, PepsiCo, AT&T Wireless and Gibson Guitar -- start selling music downloads and bundling them with other products. People still trade pirated songs on Kazaa and other file-swapping sites, but the frenzied competition to sell legal downloads removes any lingering doubt that the masses are willing to pay for digital tunes.
-- Digital kiosks pop up everywhere: Not only will record stores let you buy and burn cheap digital songs onto CDs at machines resembling ATMs, but other retailers start selling wares from digital kiosks, too. First up is CompUSA Inc., which announced it will install electronic software delivery machines in all its stores this year. Customers will soon be able to browse 1,000 software titles, explore demos of each program, and order any title to be burned to a CD and packaged for sale on the spot. In-store photo printers will catch on, too. Kodak printing stations are already present in many drugstores, offering instant prints from digital-camera cards or photo disks for 20 cents to 40 cents apiece. As printing prices plummet, these machines will spit out high-quality photos for a dime or less.
-- Falling prices create new mass markets: As the cost of processing power continues tumbling and computer components shrink further, new devices will be priced for the masses. Look for DVD recorders to go mainstream this year, along with portable video players. Young people will cart around pocket video-displays that let them time-shift TV and watch favorite shows while riding the subway to work. Apple Computerís trend-setting iPod may be the device to watch. And while consumer electronic firms and computer makers have yet to settle on standards for easily moving digital media between devices, price deflation makes it likely that a few pioneering media players will show the way.
-- Internet commerce gets cutthroat: As Internet shopping, banking and travel-booking grow more popular, competition heats up for dollars spent online. Price wars, along with a fresh crop of e-commerce start-ups, will make it tough for surviving pioneers such as Overstock.com, Expedia.com and Bluefly.com to earn profits.
-- Internet commercials flop: Internet advertisers will continue experimenting with video formats that seem promising over broadband connections, but clever programmers will find new ways to help users block all video ads. If enough people use ad-blocking software, the ad industry may throw in the towel and concede that interruptive ads simply donít work online.
-- WiFi expands: The number of public ďhot spotsĒ offering wireless Internet access will double this year, to more than 100,000 locations worldwide. The technology will grow more powerful, too, as a type known as WiMax that sends signals up to 30 miles hits the field, making it more economical for Internet providers to offer high-speed connections outside urban areas.
-- Mighty Microsoft wins some, loses some: The software giant probably will see several consumer products flop this year, including its Tablet PC, which seems as useful as an oversized Etch A Sketch, and its soon-to-be-released SPOT network, which beams weather alerts and other info to wristwatches via radio. Yet the companyís Xbox Live Internet gaming network appears to be a hit, already signing up more paying subscribers than analysts expected.
-- Internet phones ring regulatory bells: Cheap services carrying voice calls over the Internet will prove enormously popular with consumers, at least initially, but could run afoul of federal officials before the year ends. The Federal Communications Commission is weighing whether to subject Internet phone services to some of the regulations traditional phone services face, which could curb the fledgling industryís growth.
-- Internet start-ups make a comeback: Google will have a splashy stock offering after its highly profitable business is spelled out for all to see in IPO filings with stock market regulators. Barring an economic jolt that sends stocks spiraling down again, Googleís IPO likely will be accompanied by a rush of venture capital dollars flowing back into Internet start-ups. The failure of most social-networking start-ups that appeared last year wonít be a deterrent, either, because a few will prove to be big winners this year.
-- Cyber-crime grows faster than all other Internet activity: Okay, so maybe Internet crime wonít grow that fast, but itís a safe bet 2004 will be the year some black-hat cyber-dude causes major damage on a scale the Internet has never seen. Each passing year translates to greater sophistication among electronic thugs, including a new generation of bad actors who grew up playing with computers and the Internet.

While viruses, worms and Web site break-ins have already cost companies billions of dollars in lost productivity, most Internet exploits to date have been relatively tame efforts at showing off. Could this be the year multimillion-dollar electronic bank robberies make headlines? Or foreign agents unleash worms that wipe out computer hard disk drives at thousands of American corporations? Then again, itís a presidential election year. We just might see an Internet dirty trick or two, like a flood of fraudulent e-mails sent to undecided voters at the last minute, saying I shudder to think what.

Naw, thatís still tame. If technology leaders donít get serious about battening down security hatches for networking infrastructure, the crystal ball will show a far more menacing future than any sane person wants to contemplate.

Original article

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