No. 8: January 1997
Feature - The Year of Sensible Strategies?
Online 1996 - Shift to the Desktop
Disintermediation and all that (abridged / full)
Living in a time warp?
Ecash, EMU and Year 2000 bug: Critical Mass
The 3As of 1996 - Awareness, Assessment and Application (abridged) full)
Welcome to first 1997 edition of I3 UPDATE, a free newsletter analysing developments in the networked knowledge economy. You can subscribe to an email version of this newsletter.
We hope you enjoy this UPDATE, and welcome comments, contributions and feedback at firstname.lastname@example.org.
David J. Skyrme
David J. Skyrme
We have completed our 1996 analysis of developments in the Internet and online markets. Our main conclusion is that 1996 was the 'year of realization', when:
- Large corporations realized that the Internet would not go away and they had to have a serious Web presence
- The electronic commerce community realized that it needed the Internet as well as EDI
- The big banks realized that if they did not sort out online payment mechanisms someone else would o Major new entrants realized a) that Internet pricing is a different ball game; and b) you can lose a lot of money if you get it wrong
- Advertising started to take off, but in unexpected ways.
- Web sites realized that it was not about 'publishing' but about 'engaging' the user
- Users realized that unlimited access sometimes means "when you don't get a busy tone"
A few examples serve to illustrate some of these points. In the UK BT started their Internet Access service, charging £1200 a year; at year end they had reduced the price to a more sensible £11.75 a month! Europe Online, for all its great promise, and major corporate backing, closed shop in mid year losing their investors millions. Advertising made big money for some sites, such as search sites and major media sites, but not for your average company. Advertising audit companies for traditional media are now starting to measure Internet access and usage.
These examples show that the Internet is becoming main-stream. In a few years, if we get all the new software and bandwidth promised (which market forces should ensure happens), then hopping onto the Web for a few minutes should become as commonplace as picking up a telephone. You will use it to access information, to contact an expert, or simply to post a Web document online for your distributed work group - which is how I work in one project, where 'Web first' (rather than word processor) first has become the watchword.
What most large companies are finally realizing are the mistakes that can be made if you bring across the paradigms from your traditional domain. Your strategies, business processes and pricing all have to change (see time warp? below). The Internet is capable of handling many transactions cheaply. We constantly point out to the uninitiated that email is at least 20 times cheaper (and often more than 50 times cheaper) than sending something through the post (snailmail). It is capable of connecting you into business networks that would be impracticable without.
Some Key Trends
We monitor developments in five main areas - infrastructure (service providers, technologies), servers and access (clients, browsers, email etc.), content and services (directories, news, consultancy), users and applications (strategies, Intranets, commercial, consumer, public services) and wider perspective (surveys, policy, megatrends). Here are a few highlights of the major developments of 1996.
- Major entrants offer Internet services including AT&T, Virgin (with 24 hour telephone support)
- Functionality offered by online services and Internet providers converges o Interruptions in service for even the biggest - AOL, Netcom, Compuserve
- Internet access providers in the UK move to national access; some consolidation but not a lot
- Bandwidths increase; traffic up 3-fold or more for major suppliers
- Cable modems tantalize on the horizon, but POTS modems suffice for most
Comment - if you believe in the ecology model of networks (and theres lots of evidence for it) then the infrastructure will evolve without catastophe.
Servers and Access
- Time between browser versions decreases as Netscape/Microsoft thrash it out (version 3 came mid year, Beta tests of version 4 are out)
- Email clients make the grade (filters, more reliable attachments, more seamless Web interface)
- Non-events (for most of us) - Java, voicemail, realtime video and audio, net phones, agents, appliances (do you want the Web on your TV?) - still for developers and pioneers.. but coming
Comment - if you haven't upgraded your client (PC) software in the last year you could be losing out on productivity boosters.
Content and Services
- Directories and search engines converge i.e. categories and searching; reviewed sites
- More segmentation and customisation e.g. Yahoo local editions (San Francisco, UK/Ireland)
- AltaVista comes from nowhere to be the favoured search tool for many (fastest, most comprehensive)
- Growing business in meta-information; directory sites and resource indexes for specific audiences
- Customised news is the name of the game - PointCast grabs the limelight
- Cybercafes at a place near you - more universal access and coffee as well
- Secure transaction standards virtually agreed (e.g. SET) - now the real work begins for payment handling
- Media and design companies show their mettle (and their graphics) - but sometimes overdo it
Comment - there are business opportunities in enabling mechanisms and content refining.
- Intranets become big business (for hardware/software suppliers 4x that of Internets) - our research in knowledge management confirms its importance as a knowledge sharing mechanism.
- Companies start linking databases to Web pages e.g. product catalogues
- Few major companies really exploit the medium well - many ignore their users
- Some sectors more adept online than others e.g. music, specialist cars, travel
- Some notable public sector experiments and services
- Teleshopping still only for the few - high street shops dabbling ... but realize they have to do better.
Comment - the net is now a useful starting point for making better buying decisions for any sizeable purchase.
The Wider View
- Surveys find it difficult to count - old rules (e.g. 7 users per host) don't work; domain names are less reliable indicators of location
- Surveys differ wildly e.g. estimates of online sales for 2000 vary from $6bn to $60bn
- Usage and growth on many dimensions at least doubled in 1996; some parts quadrupled Policy makers take interest, but show little understanding - 'bit' taxes, copyright issues
- Wide variability in uptake by country - some have poor expensive access; others take Internet for granted.
Comment: Don't buy surveys; buy expertise and analysis (but I'm biassed!), and educate your local policy makers.
Winners and Losers
- Winners - Sun, HP, Yahoo (just), AOL (so far), niche specialists
- Losers - CompuServe, Apple (e.g. eWorld), publishers, corporate users (most)
- Jury Out - Microsoft, IBM, Oracle, smaller ISPs
Best and Worst (IMHO)
"Future of Internet hangs in balance as Geneva talks start" (scaremongering)
"Internet poses no threat to online business, hosts claim" (rose tinted glasses)
"The tax man cometh to cyberspace" (realist)
Most useful websites:
Yahoo (directory and Reuters news)
AltaVista (if it's there it'll find it)
Touchstone (for me): downloads of latest anti-virus 'patterns'
Least useful Websites:
Wall Street Journal (you have to register and pay - hard copy is easier)
Best products of 1996:
Eudora V3 Professional email (a great productivity enhancer)....which frees up time for
Microsoft Flight Simulator V6 (fly a 737 under the Eiffel Tower!)
Outlook for 1997
We expect to see general improvemens in service, more interesting web sites with wider business appeal. There will be more 'paid for' services, and paying for them should be more secure. Watch out for increasing junk mail and also for the taxman and lawyer.
Online Information 96, the world's largest exhibition and conference for the online information industry, took place from 3 to 5 December at Olympia 2 in London. There were 16,156 attendees, more than ever before, trying to find what is new in the industry. The answer, frankly, is not a lot. Most that was on show was a steady evolution of what was there before. Sure, there are more online journals, and even better CD-ROMs, and better user interfaces - but there were quite horrendous in the past, so there is a lot of catching up to do!
The conference and exhibition confirmed a few trends we had already identified and showed that the traditional online industry still hangs on to a couple of beliefs they find difficult to shed. The main trends are:
- More information delivered direct to the end-user desk-top
- The changing role of the intermediary e.g. the librarian, who needs to add value through increased business awareness, and users relationship skills
- More hybrid systems (online and CD-ROM)
- Smarter technology e.g. used of AI techniques for customisation, natural language retrieval and smart agents
- More content than ever
- Customisation, especially of news and industry specific information
- The Internet as a delivery vehicle.
Compared to last year, when many traditional online providers were dismissive of the Internet, this year they have at least recognised it. You know that since they now have their arguments together as to why their online services are better - more evaluation (sifting), better indexing and structuring, and delivering the user more highly relevant material, thus saving them time and money. It reminds of the change in the EDI community from 1995-6, from a totally dismissive attitude to one of active coexistence. The online industry is not quite their yet, but they are half way, and the smarter ones are already allowing their users to access their services through the Internet. The other long held belief is that users are happy to pay large up-front subscriptions for "unlimited access". With the shift of budgets to departments, what they need to realise is that there is a large untapped market for them (including among business individuals and small businesses) for "pay-as-you-go" information.
Here are reports from two of our associates/correspondents who attended the conference and exhibition. A more complete conference report from John Raphael-Staude will be found on an accompanying page http://www.skyrme.com/updates/u8_onlin.htm
"Disintermediation: The Challenge of Change" was the topic of one session, but a theme running throughout the conference. Technology is allowing information to be supplied direct to end users without an intermediary, such as a librarian, and tailored to their needs.
This is confirmed in a survey commissioned jointly by Reuters and Learned Information. It shows that the growth of the industry will be in the end-user market. Replies from librarians and information officers suggest that there is a likely increase of spending of 6% per annum in the next two years while that for end-users was forecast at 28% (compared to 12% last year). The survey also showed that the major players are set to expand the content of their services through the Internet, Intranet and other local networks/groupware.
Internet vs. Online
The second day began with a panel about "Publishing and the New Media". This was followed with a discussion of ways to enhance searching and retrieval, intelligent agents, the quality of information they produce, and some aspects of the impact of this new software on the information society. In the afternoon a tutorial on team building in the workplace was offered as an alternative to the panels on "New Ways of Delivering Information" and on "Internet Access and Telecoms Developments," as well as a workshop on scenario Forecasting the Role of Business Information".
The liveliest session of the conference was a panel discussion about the future of traditional online services given the challenge of the phenomenal growth of the Internet. This session was chaired by Heinz Ochsener of Knight-Ridder Information in Switzerland who himself made a brilliant and provocative presentation entitled "The Internet and the Demise of Traditional Online" which sparked much discussion from members of the panel and from the audience as well. "The Internet marks a fundamental change in the industry, he said, bringing together diverse information sources and audiences never before united.While admitting that traditional online is in decline, Ochsner argued that online can have a rosy future because hosts bring to the Net their years of experience in developing and refining sophisticated search tools which enable them to search efficiently across a wide range of sources with the knowledge that the information available is authentic, authoritative and of real value."The Internet is an opportunity for hosts to deliver targeted tools which precisely match the searching requirements of different audiences."
Customisation in the News
The market sector attracting most attention currently is that for customised news services in which users are able to select, using a range of profiling approaches, only those new stories of direct relevance to them. This profile is run against new stories of a regular basis, often twice a day. Among the benefits that these services seek to offer are:
- eliminating the need for a user to scan through a multiplicity of sources
- providing information from multiple sources in a common format
- delivering the content on a timely basis
- providing summaries of news items
- providing interfaces from internal transmission of information through and in inter net (like Lotus Notes)
- providing archival retrieval as well as current awareness
Some of these act only as integrators of newsfeeds and provide fairly limited profiling, whereas others provide very substantial levels of editing and indexing, and this is of course reflected in the subscription price.
One of the most exciting exhibitors at the Online 96 conference was M.A.I.D. which demonstrated its new service "Profound Live Wire," in what they claim as the first ever customised real-time alerting service with customised packages based on an "All-You-Can-Eat" pricing system designed to control information costs for companies. These M.A.I.D. products should be available now as they were scheduled for release for 1 Jan 1997.
Taking advantage of M.A.I.D's InfoSort categorisation technology M.A.I.D offers an efficient Intranet strategy in which each company is able to define the information which it sees as relevant to its successful operation. By predetermining the information required individuals within the business have access to an updated electronic library of internal and external sources specifically relevant to their own needs.
Other customised services on show were from Desktop Data and Individual Inc. Desktop Data's principal product is NewsEDGE which delivers an integrated news service based on some 600 stories onto a LAN server on the subscribers premises. In contrast, Individual's First! service uses content analysis with sophisticated software which can be tuned to improve the relevancy of user profiles as their needs change. First! is a corporate subscription service but over the last two years the company has launched a number of complementary services (HeadsUp, NewsPage, and iNews) which are targeted at the smaller company, or the individual subscriber in a larger company.
Also at the Conference
The first session was entitled "The Information Society." In the one and a half hours at their disposal R.F.de Bruine from the European Commission Geoff Hoon from the Labour Party and David Worlock of the European Information Industry Association discussed their visions and concerns regarding the Global Information Society including the question of Rights of Access. It was agreed that the Government should make much more information freely available to the citizens.
In the afternoon there were discussions of innovative approaches to "Online Education and Training" and "Networked Information Resources." The second day began with a panel about "Publishing and the New Media" and was followed with a discussion of ways to enhance searching and retrieval, intelligent agents, the quality of information they produce, and some aspects of the impact of this new software on the information society.
For the online professionals there was not much new. It is interesting, though, that the topics covered at online are now broader in scope, thus increasing awareness of wider business, technology and policy issues for information professionals.
© Copyright. John Raphael-Staude
email: email@example.com (John Raphael-Staude)
A fuller article about ONLINE 96 will be found at http://www.skyrme.com/updates/u8_onlin.htm
It makes you think when you've been attending an exhibition for 14 years and that nothing has changed! The Internet and the World Wide Web, all the buzz and rage last year and the year before had all but disappeared from the picture. There was not a whiff of the key arts of information / knowledge management. All the old online spinners were there hawking their massive databases just as they always have done. It was Roger Summit, the doyen of this industry, who pointed out that 10 years ago one spinner, Lockheed Dialogue (as was) was many times bigger then -- in terms of terabytes -- than the World Wide Web is today. The traditional online industry is a world in which the prospect of free or low cost information strikes utter terror and in which the process of turning their information into useful knowledge is deemed to be someone else's problem.
There was one thing I found at the show, however, which was surprising.
The price of text retrieval packages -- the software traditionally used by the online spinners -- is rising. This part of the industry seems to be making lots of money from the soaring demand for indexing -- you guessed it -- Internet and Intranet Websites.
Time warps do not last for ever.
© Jan Wyllie, December 1996
Through a happy combination of chance and design, within the next three months, Trend Monitor is content analysing the 1996 coverage of these three subjects. The research is well progressed on electronic currencies and online banking, so I can state the obvious very definitely: they radically change the economics of commerce. Into this environment of electronic cash and private currencies, yet another new currency will be launched with unknown, but possibly devastating effects on local economy, along with the collateral damage of social unrest. Now fold the Year 2000 (Y2K to the in-crowd) into the mix which makes it impossible to know exactly what time-based actions the computers which control finances and the economy will take. To put it mildly, it's a super-critical brew capable of starting completely unpredictable chain reactions. Nobody knows. There is only one thing for certain. There is going to be massive demand for the people responsible for putting us into the predicament in the first place: software programmers and bankers. The only hope is to keep up with and begin to anticipate the surge of change that is about to happen ... which is exactly what Trend Monitor's reports are designed to do.
©(c) Copyright, Trend Monitor, December 1996
Trend Monitor International Ltd.
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Links updated Aug 1999.
Debra M. Amidon
Abridged from The ENTOVATION Network Newsletter Volume 2: No. 1
"The knowledge movement is pervasive.
Whether it is defined in terms of learning, intellectual capital, knowledge assets, transfer systems, know-how, insight or wisdom, the conclusion is the same: manage it better or perish."
(Debra M. Amidon, The Ken Awakening)
The Year in Review: The 3A's of 1996
1996 was designated 'the year to move theory to practice' and indeed, we have. The 3A's - Awareness, Assessment and Application - provide insight into the variety of activities which contribute to advancing the state-of-the art and the state-of-the-practice simultaneously. In so doing, we have promoted the fundamental notions of change at all three levels: the success of the enterprise, vitality of the nation's economy and society-as-a-whole.
I. Focus upon Awareness:
Seeds planted for years have begun to flourish.
Two books will be available in early 1997.
Innovation Strategy for the Knowledge Economy: The Ken Awakening, with a Foreword by Leif Edvinsson, V.P. for Intellectual Capital, Skandia, will be published by Butterworth-Heinneman. This takes a 'Monet view of management' - seeking to envision the whole in order to create an understanding of the parts. The concept 'ken' captures the need for knowledge, perspective and range of vision and is found in many languages.
Creating the Knowledge-based Business, co-authored with Dr. David Skyrme, a major research report including several leadership case studies, will be published by Business Intelligence (UK).
Several new articles appeared including "The Momentum of Knowledge Management", "Challenge of 5th Generation R&D," "Dialogue With Customers: Secret to Innovation Strategy". For details visit the ENTOVATION Web pages at http://www.entovation.com
II. Focus upon Assessment:
The era of Knowledge InnovationTM has gained significant momentum.
Organizations have launched efforts to systematically measure and manage the process of innovation. In conjunction with LearnerFirst, we are developing a software application - soon to be available on the Internet - to help calibrate innovation capacity according to our ten dimensions of innovation strategy - from intangible performance measures through cyberspace.
An innovation Litmus Test has been made available on the ENTOVATION website to gauge your current practice. International standards are evolving which are commensurate with our KENovation (sm) modules so we can now certify exemplary organizations which create and move ideas expeditiously into the marketplace.
Such perspective enables an individual, organization, industry or country to gauge their capacity for innovation.
How would your organization benchmark against the evolving state of the Knowledge InnovationTM practice?
III. Focus upon Application:
Perhaps the best illustration of progress has been in how these concepts have been mainlined and leveraged in several leadership organizations: Skandia, Steelcase, CIBC, Arthur Andersen, MIT, Columbia University, Semiconductor Research Corporation, The Agility Forum, British Petroleum, and more.
Similarly, the ideas have been adopted in several countries with knowledge initiatives based in academe and government. Moreover, the infrastructure now includes ENTOVATION Fellows who manage related businesses according to the ten dimensions of innovation. Worldwide experts are available to lend their expertise on performance metrics, intelligent alliances, distributed learning networks, leadership design, and computer technology to mention a few.
How might we adapt these innovation principles to your organization?
1996 ENTOVATION Colleague of the Year
Mr. Britton Manasco is President of Quantum Era Enterprises, Mountain View, California. A leading journalist in knowledge management, he is also editor of Knowledge Inc which has grown to a sizable readership of several thousands a month. With a focus on lead practitioners, the newsletter has already included profile material on over four dozen companies illustrating the fundamental nature of the shift toward intellectual capital. Manasco has developed a premier instrument for sharing our 'real-time' learnings with a keen sense of implications for business results.
What lies ahead?
The knowledge community now includes a critical mass of expertise across several regions of the world. Concepts and implementation strategies are well documented in publications, our website and software applications. Our vision is truly a global awakening of the 'ken' in us all. 1997...the year we leverage our collective insight.
© Copyright. Debra M. Amidon, Founder, ENTOVATION INTERNATIONAL
© Copyright, 1997. David Skyrme Associates Limited and Authors - All rights reserved.
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I3 UPDATE is a publication of David Skyrme Associates Limited - providers of market studies, consultancy and strategic advice in knowledge
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