2001 may well be the year of the IT revolution, but as far as I’m concerned, we’re talking about utilITy. From here on, usefulness is going to be the benchmark for information technologies.

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The overall state of the economy is partly responsible — take a little froth off the bubble and people start getting testy about value for money, but consumers are also maturing, markets are getting saturated, and the novelty value of a lot of these gadgets is waning.

To a large degree, that is behind the shakeout in the stock markets. Irrational exuberance has had its day, and investors are now demanding a return on capital. Vaporware is one thing, vapor profits and very real losses are another.

Economists call the ripples that market losses have on the real economy “the wealth effect.” Individuals feel like all those paper riches are worth something in the real world, so they spend more. Those indulgences include toys and gadgets that defy common sense or just look cool. My feeling is that just as investors are going to demand tangible benefits from their capital, consumers are going to demand that new products deliver real satisfaction.

It’s hard to argue with that — except that it hasn’t been the standard operating procedure to date. Chips get faster, storage expands and screens get bigger (or flatter), and consumers rush to get the new new thing, whether they need it or not. New software is usually buggy as hell, and the weeks after release are filled with news reports of patches and repairs. That sort of product management is going to end.

FunctionalITy will be the key. The item that tops my wish list is an all-in-one PDA/phone. My Visor comes close. With the modules I have, it serves as tape recorder, MP3 player, camera and all-around organizer. On the train, I read daily news downloads while listening to songs. I may buy the phone module when it is available here. (Journalists use the keyboard and modem to turn it into a portable news desk. I may give that a whirl.) Nokia and Ericsson are developing their own versions that start from the phone, rather than the PDA, and keitai are morphing as well.

Contrast the Visor with my Newton: It was a real eye-catcher and it read my handwriting pretty well. But Newt didn’t integrate into life. I couldn’t sync with my PC, couldn’t do many things I do with the Visor. It wasn’t functional and that’s the bottom line. As penetration ratios approach saturation rates, the IT market will move from goods to services. One reason is that people are going to run out of pockets or places for new devices — especially when budgets get tight. But a more compelling reason is that IT erases the line between products and services. We no longer need to buy specific “things”; it is easier, and more efficient, to buy a service (an online organizer or business software, like Microsoft’s new .Net) than to get your own.

Value for money? Now that’s a revolution.

Brad Glosserman (brad@japantimes.co.jp)

Another view

My neighbor has a point, but I think IT all comes down to money and, um, securITy. Last year commercial providers of content and services, whether independent startups or spinoffs of larger entities, had to downscale or close shop. In many cases, lack of advertising knocked the bloom off the rose, so you can bet that a lot of outfits are reconsidering payment schemes. Will micro-payments be the way to go or all-you-can eat subscription plans? Will credit cards prevail or will we return to some form of virtual cash?

Naturally they’ll have to factor in the trade-off between convenience and security. Many Net users already keep track of a variety of log-in IDs and passwords to access content and commerce. And even if users don’t offer the data voluntarily, browser cookies tag them anyway. Your soul can’t be stolen by a camera, but what about that digital scrapbook on the home computer, the one that details financial history, family health records, browsing habits?

The protection of private data and transactions, financial or otherwise, is not yet guaranteed, although many people already know the hazards of sending precious data to a remote computer. Wireless technology will require even more vigilance.

Perhaps it’s best to think of it as “Me Media” — the catch-phrase one cellular phone company has used to market the wireless world. Indeed, our cellphones will soon represent our identities in more ways than one. This is the nature of the beast.

Private space — My Space — has been touted as a benefit of cellphone culture in Japan: Mobility frees users from the bondage of land lines. But what happens when you’re constantly sending signals to the mother ship, when your location can be tracked? Look around — we’re practically there. For a glimpse of the possibilities, check out the location-precise services of Gravitate (www.gravitate-usa.com or www.gravitate-japan.com). It’s a small world — but do you want all that intimacy?

Like many others, I have praised the elegance of DoCoMo’s i-mode scheme. But as with AOL or Microsoft, there is a risk here of full-service companies making decisions for consumers that simplify life by removing choices. Globally recognized standards for media, networks and payment are desirable, but at what price? This is where we should define value.

We need to map out the paramters now because a matrix of embedded technology lies just ahead. Consciously or not, we will interact with physical sensors and transmitters. We’ll walk around with little clouds (of persistent data) over our heads. The initial interface will probably be the cellphone, but only initially. You think the FBI’s omniscient Carnivore is scary? What happens when our retinas become PINs, when cranial bar codes and network-responsive DNA become the default. Will we call that convenience?