*spark>>

http://www.spark-online.com

Technology Rules: Internet or Betamax?

By Jared Mitchell

Federal Express called it Zapmail because of the great speed it promised. When Fedex introduced electronic mail in 1984, it enabled customers to send documents in a few hours instead of overnight. Customers could drop off documents at a local Fedex office and have them sent by satellite across a continent to another Fedex office for local delivery. Fedex was so chuffed with the prospects for this hybrid of paper and electronic transmission, it planned a $1.2- billion (U.S.) outlay over 10 years for equipment. But just two years and $340 million later, Fedex zapped Zapmail. Everyone everywhere was zapping his or her own mail with a hot new technology--the fax machine.

Fax machines and other champions of electronics provide some important lessons about how new technologies settle into our lives. The following are rules that turn The Next Wonderful Thing either into the Internet or Betamax of its generation.

One: Time. One reason why certain technologies are resoundingly successful and others fail is the ability of new products to save time or help individuals control time. Four champions of the late 20th Century--the fax machine, the VCR, E-mail and the automatic teller machine (ATM)--all delivered this. The VCR proved to be enormously successful because people could control time by shifting when they watch programming.

Two: Convenience. If a technology makes it easier to do something, people will use it. Canadians make 30,000 calls on cellular phones to 911 emergency services every month. It says as much about how easily consumers can reach for their cell phones as the mayhem they must be witnessing. Likewise, the grandfathering of ATMs to the Internet has ensured the long-term survival of self-serve banking.

Three: Regulation. No other technology held such elusive promise as high-definition television (HDTV), which would have delivered 1,500-line video pictures, rivalling motion-picture film for clarity. HDTV might have been everywhere by now if the Japanese had been able to swamp the world market with sets, just as they had with colour television in the mid-1960s. But they have been blocked for years by the European Union, and by U.S. electronics companies, who successfully lobbied their regulators not to approve the expensive sets of technical standards for HDTV. That, says Stephen Rosenthal, a director of the U.S.-based industry-academe Manufacturing Roundtable, was the mortal blow to HDTV. "In order for a technology to be a success you have to have broad technical standards," says Rosenthal. This protectionist strategy paid off for Western manufacturers. By forcing regulators to drag their feet, these companies used the time to create the now-inevitable digital standard that will leapfrog over Japan's analogue-HDTV standard.

Four: Humanity. Technologies that demand people change the way they behave are doomed to failure. Microsoft likes to refer to something called the technology-adoption curve. Personal computers, for instance, had a slow adoption rate in homes because of the built-in behaviour-modification requirement. Indeed, the amount of time we spend futzing with new programming techniques on the World Wide Web alone, with their growing arrays of peculiar plug-ins and demands for catalogues of Personal Identification Numbers and passwords, have vastly alienated the public. Contrast that with debit cards. Interac, the association of Canadian financial institutions that share a national banking network of ATMs, is ecstatic with the POS terminal's acceptance. Whereas it took 10 years for Canadians to make 300 million annual ATM transactions, it took only five to reach that number with POS terminals. That's because consumers already knew how to use ATMs, so they were automatically comfortable with debit terminals.

Five: Cost. The less money a product or service costs, the more likely people are to buy it. When car phones cost $4,000 apiece in the early 1980s, there weren't a lot of consumers buying them. Now that they are given away free as part of phone-service contracts. Says Thomas Bodenberg, assistant professor of mass communications and public relations at Boston University: "When the price point goes below $200 (U.S.), you can break out a technology--VCRs proved this." Laptops could become as ubiquitous as calculators if they fall below $200.

Six: Snowballs. The question accompanies so many business telephone calls these days you can almost predict it: "What is your E-mail address?" E-mail has become so pervasive that it's almost impossible to do business without it. E-mail is the latest example of a product benefiting from snowballing--the process by which late technology adopters come on board quickly and in large numbers. The amazing aspect to E-mail was just how quickly that snowball got rolling.

Ultimately, the most important component of a technology has nothing to do with its physical aspect but with human need. Although “videotex” was the direct ancestor of the World Wide Web, it flubbed its entry because it answered no particular need. That technology sought to provide masses of data over television sets accessed with hand-held keypads. Most of that information, such as news, weather and financial data, was already available, freely or cheaply, through existing channels. Videotex added nothing. A technician working on Telidon, a pricey version of videotex fostered by the Canadian government in the late 1970s, complained at the time that videotex was "a solution in search of a problem." Yet filling unexpected needs happens all the time. The World Wide Web has taken off, partly because of low cost, partly through its convenience but also because Internet programmers began to find all sorts of cunning uses for it that never occurred to the videotex boys: trading stocks, buying stuff and connecting micro-communities of people with common interests. And that matters more than all R&D into processor speeds in the world.

Toronto novelist Jared Mitchell has written about technology for The Globe and Mail and many other publications for eons.