NetWatch

Issue No 3

29 January 1997


GLOBAL VILLAGE

Hong Kong - like man it's now

The new $38 million British Council has literature buffs outraged, deciding to donate pre 1900 books to Hanoi's Public Library and use the space for Internet terminals. Those down the road to Hanoi included William Shakespeare and Jane Austen.

Compuserve expands in Europe

CompuServe has expanded into Switzerland and aims next at Austria, Sweden, Belgium, with the company increasingly focusing on markets outside the U.S. CompuServe already has localised services in the UK, Germany, France and the Netherlands and has established a clear lead in Europe over arch-rivals America Online Inc. and the Microsoft Network (MSN), Microsoft Corp.'s online service.

Ditto to China

CompuServe also said it's close to an agreement that would offer its service in china by July. CompuServe is also exploring expansion into India and other parts of Asia. The company already has 2 million subscribers in Japan through licensee NIFTY-Serve.

SERVICES ON-LINE

They know the way in San Jose

Bigger.net in San Jose is offering the ultimate unlimited Internet Use package. $US59 for lifetime unlimited Internet use. Yip that's $US59 for life (plus $10 dollars p/a to keep your email address current. Company income relies on banner ads appearing in a boxed area on users' computer

On-line cinema?

Sony Pictures has demoed electronic cinema. Steven Cohen, of Sony, said it was to test potential to transmit short pieces, i.e. as trailers. "The focus was on the use of electronic cinema for preview purposes," he said. The electronic image was beamed from Keystone Communications, by satellite uplink to the UA theatre.

DOING BUSINESS

Volkswagen lets it all hang out

In upgrading their site on the Internet Volkswagen of America will allow enthusiasts to shop, order, and make credit card payments for everything from baseball caps to distributor caps. By year's end they'll be able to locate, order, and pay for automotive parts as well. VW is one of dozens of manufacturers using Web technologies to help phase out expensive legacy systems. Its initiative also shows how manufacturers must juggle a new sales and marketing channel--the Internet--with existing channels, such as dealerships. The worry is that the Internet will hurt business with dealers. Dealers consider that the Internet will educate buyers and turn them into prospects.

Uncle George prowls the net

George Soros one of Earth's most savvy has taken a 7.1% stake in Earthlink Network. The company will not build a structure of its own but will instead spending heavily on customer service, a is a major source of problems among users of various Internet services. Earthlink currently has around 180,000 modems for around 250,000 users. And its customer base is said to be growing by around 8,000 per week -- mostly by word-of-mouth.

Sounds like a winner

MagicFax will allow users to send faxes anywhere in the world for free. The software allows individuals in companies of all sizes to send faxes to other MagicFax users around the world without receiving any phone bills or monthly service bills. Faxes sent to non-MagicFax users will save on transmission costs, as MagicFax routes the fax to the sender's MagicFax Web Server nearest to the recipient to avoid long distance charges. An average international five-page fax sent from the USA to Japan costs approximately $18 over traditional phone lines. However, that same fax sent by MagicFax over the Web can be free of all phone charges.

SURVEYS

Hark the till bells rang.

Net shoppers spent about $US194 million online in the US over Christmas. - three time more than 1995, according to a study by Jupiter Communications NY. Sales for y/e 96 are estimated at between $500 million and $600 million. America Online reports that sales topped $1 million in just one day at the AOL Marketplace, which links users to Lands End, JC Penney, Starbucks Coffee, Godiva, the Nature Company and dozens of other retailers. Some 14 percent of U.S. retailers either have Web sites or plan to, compared with 4 percent a year ago, according to a study by Deloitte & Touche. Wal-Mart just announced plans to put 80,000 products online. Internet shopping is estimated to generate between $6 billion and $7 billion in sales by 2000

Yes Dr Dolittle there is a pushmi-pullyu

Most Internet users pull data down from the Internet, but the latest trend is ``push.'' Latest software can be programmed to go to your favourite Web sites at particular times of the day, and automatically download data. The information is ``pushed'' onto your hard drive, for instant use when you want it. Media companies and advertisers see push programs as a way to make the Internet pay, by making Web surfing almost as easy as TV channel surfing.

Keep those Email newsletter rolling

The Internet mailing list is a simpler push technology that's been around for years. They automatically send information by e-mail direct to your electronic mailbox. They're simple, free of charge (usually) and free of advertising. And because the data arrives as e-mail messages, no complicated slow software is needed to collect them, a simple mail program will do. There are over 20,000 mailing lists worldwide, on every subject you could imagine. If you can't find or imagine one start your own.

NUTS AND BOLTS

E-mail you can't rip open

Last year IBM launched its Cryptolope containers described as secure envelopes that protect digital content distributed via the Internet. These digital envelopes cannot be opened until the sender authorises it, either by receiving payment for the materials or through verification that the correct person at the other end is opening the envelope. InfoMarket, the first showplace for Cryptolope technology, will soon offer users more than one terabit of content from more than 6,800 magazines 300 newspapers, 75 newswires and profiles on more than 11 million companies. With the enhanced Cryptolope security, the company has been able to expand its portfolio of services to resell tickets, books, college courses, clip art and direct marketing.

And the swift will inherit the Internet.

Pacific Bell plans to start rolling out a powerful new data service later this year is a direct challenge to cable television companies that already offer high-speed Internet access to some homes. Asymmetric Digital Subscriber Line (ADSL), lets customers download Web pages as much as 50 times faster than normal telephone modems, over existing phone lines. Price . At about $165 a month for ADSL Internet access on top of a $600 set-up fee price may be a barrier. Most cable TV systems aren't yet capable of sending data in two directions, so cable and telephone companies are still neck-and-neck at this early stage of their race.

BT calls home

British Telecom says it is looking at new ``packages'' in its campaign to beat back competition from the likes of Mercury and the cable companies. BT (British Telecom) is considering offering ``free local calls'' for domestic customers coupled with higher line rental charges in a move that could transform Internet use in the United Kingdom. One favoured route, which would bring the UK into line with America and Asia, would be to slash charges for local calls and charge a higher quarterly line rental instead. In the US, where Internet usage per head is by far the highest in the world, individuals benefit from packages which offer ``free'' local calls coupled with a premium line rental charge.

SNIPPETS

Too much money not enough culture - Pope

Pope John Paul In a written message for the Roman Catholic Church's World Communications Day, said that Western media organisations exporting their products around the world are more interested in making profits than spreading appropriate cultural values. "The truth of the matter may well be that the foremost value they genuinely represent is commercial profit," he said. The Pope also said People who wanted to use the media to spread good were not seizing the new opportunities available to them, he added.

The box office in your box.

Ticketmaster Online's "Chatsville" is a live forum for acts to talk to their fans and promote upcoming shows. It is the only web program that directly links chats with online ticket and merchandise sales. First day event ticket sales for all major concerts will be phased in over the next few months. Ticketmaster Online currently has tickets available for more than 20,000 events nation-wide, including Broadway theatre. Rock band Counting Crows will talk to their fans and discuss plans for a series of exclusive online ticket sales for upcoming select concert tour dates when they host TicketmasterOnline's "Chatsville" cyber-chat on Wednesday, January 29, at 9:00PM (EST) Counting Crows will discuss their current album, "Recovering the Satellites" and their tour during the "Chatsville" appearance.

Do it yourself cabling - the next wave.

Fed up with the idea that their access speed was so appalling Ramona street residents in San Francisco got to and installed a T1 cable themselves.

Jonathan Steuer, a Harvard graduate and computer wunderkind, wanted to start a technology-based company out of his apartment. So he got $10,000 venture financing from a friend and last year installed a T-1 cable and hardware providing Internet access more than 100 times quicker than the average telephone line, enabling, for example, video images to be transferred from one computer screen to another.

Comment

SA please note.

In the State of South Australia the hope is that over time the economy will move from being hewers of wood and drawers of water to become a modern high tech job creator. Well it's worth noting that this has been done in a similar agricultural resource based area and pondering just how it was done.

In Bill Gates home state Washington USA, a study shows technology-based industries now account for over 1/3 of all jobs well ahead of such traditional sources as timber and agriculture.



Lead author Bill Beyers notes ``We've evolved from a state where natural resource industries were our economic heart into a more diversified economy,'' Beyers said. ``Today these parts of our economy are growing fast, and these are good-paying jobs -- they're the kind of jobs we talk about wanting to create.''


The study found Technology-based industries contribute disproportionately to the state's economy, since 76 percent of their sales are made out of state, compared to an average of 40 percent for the economy as a whole.

Gates (bills dad one of the organisers of the report) noted ``You need the external influences - things like a first-class university, first-class research institutions. You need to be sure you've got the kind of place where professional people want to come and live.''

One signal difference between Washington and South Australia is that almost none of the high tech industries in Washington started with a Government grant or subsidy. Much more crucially no business in the state expect their future to be improved or determined by government handouts to business. Defence spending yes but subsidy no.

Government subsidies tend to crowd out the real entrepreneurs who have their eye on the market and are not constantly on their knees to the bureaucrats who hand out subsidies and the politicians who claim the credit.

Entrepreneurs real entrepreneurs are not delicate flowers that need the sprinkle of other taxpayers money to blossom. These are people so infused with the prospects of the market and the benefits of their product that they beg and borrow to make it an enterprise.

The economic climate, the level of business confidence so vital to that decision to commence a business are not factors in government assistance. Assistance is driven by political considerations, aimed at the voters not the customers. Unfashionable technology or that that will in the short term affect jobs are out.

Property is the preferred investment area of the politicians since its tangible, voters can see it, its in an electorate The

dull stuff of shipping product is a growing day to day event that is hard to gather kudos from.

There's also tendency to go for big bang solutions with large companies, guaranteeing positive headlines.

So what's the alternative. In places going places its venture capital, enterprising lenders and a culture of doing it yourself..

And that's the South Australian difference. There is no organised venture capital market for the $10 or $250 thousand you might need to start a small enterprise that will grow into a very big enterprise.

That venture capital market can only grow when the culture of putting all superannuating in unit trust funds, in property ,changes. When a small amount is put into risky ventures. Where banks back ideas not collateral and put a fraction of their lending funds in unsecured risk ventures.

You also need a culture a ethos of getting ahead by doing business not waiting on a form of business welfare. In South Australia small business people tell you often they are waiting for the government to put money into the economy.

That a change of stamp duty or an infusion of funds into this or that industry will make the difference. Whose money? Australia and this state suffer from the latter stage of Leninism where the government by

FID taxes, window tax, payroll tax, wholesale tax, car tax , registration tax, gambling tax, drink tax, land tax, petrol tax, lending tax, borrowing tax, transaction tax, income tax, company tax, standing tax, traffic tax, fees, lotto tax, racing tax, siphons about 80% of the money from the population and then in the supreme irony goes to the business community and subsidises them with the money their customers might have had!.

There might be merit in leaving the occasional dollar with the customers to spend with enterprise and grow the capacity of the state to build jobs. By new enterprises that increase the size of the cake. Not the fuzzy illusion created by government robbing Paul to subsidies peter so he can buy from Paul.

The State has an excellent unbeatable lifestyle, first class universities, the worlds best weather, a most civilised elegant capital city, low property prices, brilliant beaches and amenities. Life style alone will not nurture entrepreneurs, nor in my view does Government action.

What is needed is some courage from the investment institutions to place a small fraction of their funds in really risky ventures, and word to spread about the universities and the wider community that good ideas and energy create business's That business is an honourable undertaking, that it provides jobs tax and livelihoods for the whole community.