The Comdex trade fair last week heralded a computing future
splintered into a variety of mobile units communicating via the
Internet, with wireless Internet connection tipped as the next
killer app
Although Bill Gates and Michael Dell used their keynote speeches to
argue that the PC is still dominant, evidence of an industry shift
was all around them. The trade show this year moved away from its
traditional PC focus, with exhibits ranging from networking and
information appliances to wireless devices and e-commerce.
While admitting the market for PCs was slowing, Microsoft CEO
Steve Ballmer pointed to Europe as the next target. “The
penetration of PCs for white-collar workers in Europe is only
two-thirds of what it is in the US,” he argued. “I think there is
plenty of upside. If the US is saturated, Europe is not and I’m not
sure the US is saturated.”
Michael Dell, CEO of Dell Computers, acknowledged a “slowdown”
in the market, but said that concentrating on its core PC and
laptop business was keeping the company strong.
He predicted wireless connectivity would have “a huge effect on
the future of our industry”, saying it would become standard for
all Dell notebooks. He also argued that businesses would soon shift
to wireless networks.
Old sparring partners Oracle and Microsoft again exchanged
barbs, with Microsoft’s vision of “smart” devices like PCs linked
by servers in contrast to Oracle’s version, in which simplified
devices are linked to large servers and databases.
Microsoft was clearly trying to move into the newer mobile
market, while maintaining the use of the Windows operating system.
In his keynote speech, Gates previewed the Tablet PC, a pen-driven,
fully functional mobile PC. He later described the Tablet PC as “an
opportunity to both grow the portable PC market and become a
significant part of the portable PC market”.
Oracle CEO Larry Ellison used his own speech to dismiss the
software produced by Microsoft as “too complex” and deride the PC
as becoming a mere “appliance”.
Ellison announced a joint venture in which Oracle would
pre-install software on Compaq servers, aiming for all-in-one
product simplicity. “If the appliance model makes sense on the
desktop, it makes even more sense on servers,” Ellison argued.
Oracle predicts server application sales will generate several
billion dollars for it next year, which represents about half its
revenue. This will place Oracle in direct competition with
Microsoft’s Windows NT platform, with Oracle claiming the
pre-installed software will make its product cheaper, faster and
quicker to install.
Ellison said that Oracle and Compaq would release an appliance
in December for its new application server. The software runs
transactions for e-commerce. Ellison added that Sun Microsystems
and Hewlett-Packard would soon announce their own appliances for
Oracle’s application server.
Hewlett-Packard CEO Carly Fiorina had to face the Comdex crowd
right after the news of HP’s failure to make expected financial
results. She acknowledged the results but moved straight on to her
prepared speech, advocating a “digital renaissance” in which all
computers, software and services would be linked to the Internet
and available to all.
While Fiorina’s speech was very much about the future, HP’s
abandonment of its bid for the consulting arm of
PricewaterhouseCoopers (PwC) in the light of its surprising fourth
quarter cast a shadow over HP’s own future direction.
Fiorina said the company still wanted to move into the services
market, although its failure to acquire the PwC assets was a blow.
Fiorina took “full responsibility” for the results and told
analysts after her speech that she had “let the PwC opportunity
linger for too long”.
Dick Brown, chief executive of computer services and consulting
giant EDS, said this year’s dot com bust was a lesson to the
industry to return to the “basic fundamentals” of business. He
advocated a “digital economy” in which workers used mobile devices
and wireless technology and businesses offered “relationships, not
just transactions”.
Brown argued that companies needed to establish trust with their
customers, partners and suppliers, “collaborate in new ways”
through partnerships with other firms and “seek improvement” by
thinking ahead of the competition and being ready to change
strategy quickly.