Subject: [NEXTEL-1] COMMUNICATIONS, TECHNOLOGY & INTERNET

From: Marcel <[email-masked]>
Date: Tue, 14 Jan 2003 14:09:14 -0500

COMMUNICATIONS, TECHNOLOGY & INTERNET

Technology keeps marching along

Broadbands and 'smartphones,' 3G and PDA, wireless devices and bundling. The technology
advances keep coming, brushing aside a sinking economy and anything that stands in their
way

By Tracy D'Souza

For some businesses and industries, 2002 was not only not all bad, it held promise for a
burgeoning future.

• The cellular companies are poised to go global and even more mobile with their "3G" or
Third Generation technology, which will connect your Palm Pilot, your tablet PC, and your
mobile phone to broadband fast speeds.

• Industrial businesses are taking advantage of information technology to streamline their
distribution and manufacturing processes.

• Some business owners point to the most recent two-year cycle as a crucible, well-managed
and well-performing companies surviving amidst the ashes of failed dot.coms. However, the
decreased spending in research and development will slow the appearance of new technology
as we look at 2003 and beyond.

"Average consumers won't notice; [but] it will take longer for new technology to emerge.
With less money for research, the pipeline for further innovations will be longer and that
money will not be replaced," says Barbara Kurshan, co-CEO of Core Learning Group.

The cellular industry is about to undergo a large transformation that has been several
years in the making. The business has taken a firm foothold in the burgeoning information
technology by expanding phone capabilities from merely voice to data, picture, and movie
transfer.

"Third Generation" refers to the evolution of wireless signals, from analog to digital to
the Personal Communication System (PCS) at 1900 digital MHz. The new capabilities on the
PCS level will allow for real-time e-mail, Internet access on your cellular phone at
broadband speeds, more advanced games, and image exchange, according to Jeremy Barbour,
sales consultant at Verizon Wireless in Tanglewood Mall in Roanoke.

In the past two years, Verizon spent $4.6 billion in research and development, increasing
its service area and implementing the PCS technology and will spend another $4.6 billion
in the next two years.

The company hopes to launch its 3G system by summer 2003, providing both the advanced
digital service and new hardware to utilize the signals. Consumers, both private and
business, should soon be able to purchase multifunctional "smartphones," like the Kyocera
7135. These smartphones will be advertised as replacements of the most portable of PC's,
with folding mini-keyboards and increasing megabytes of RAM for more and more software
programs.

"[With the acceptance of broadband], we'll see a convergence of personal and business
communications devices. Mobile phones, PDAs [Personal Data Assistant] and GPS [Global
Positioning System] will merge to create a mobile device that is much more location
oriented and can allow you to interact with the world immediately around you," says Gordie
Ziegler, executive director of the New Century Technology Council.

While landlines may soon seem obsolete, they will still be part of package deals from
many-armed companies like Verizon, Sprint, and AT&T.

"'Bundling' will be the competitive edge, as carriers will package multiple services
including unlimited Internet, Wireless, Long Distance and Local into one plan. In fact,
the term 'long distance' will likely go the way of 'typewriter.' Everything you can get at
home and work will become available on your wireless 'device,' which you won't call just a
phone anymore," says Dan Overstreet of Ntelos.

Wireless data transmissions are predicted to increase as well, with individual offices,
businesses and homes becoming cordless. Wireless technologies like Bluetooth and Wireless
Fidelity (Wi-Fi) now allow people with laptops to surf the Internet, print from any
printer, and access network data while roaming around their home or office building.
Infrared technology is available now, but at limited distances, often a range of no more
than 10-20 feet between the computer and its target.

According to David Pascual, media specialist at RS Information Systems, the Bluetooth
network has a range of approximately 100 feet, while Wi-Fi networks, such as 802.11, have
a range of 200 feet.

Because of an overlap in functionality, i.e. portability, Kurshan speculates that wireless
and cellular industries will merge: "Most of the wireless and cellular capabilities will
merge, but the actual technologies will remain two separate things. I think, ideally,
cellular phone companies are just hoping cellular will be able to do many of the things
currently possible only over 802.11 or other Wi-Fi networks. They'll be able to do this
because of increased bandwidth to each cellular user - increased bandwidth they'll get
from the FCC - as well as through different data compression methods, and additional
towers."

With the greater resources of cellular technology and the increased convenience of
wireless technology, the Internet will become ubiquitous in both homes and businesses.

Doyle Edgerton, president of Rev.Net Technologies in Roanoke, points out that competition
and capacity has allowed high speed Internet to be increasingly affordable. "I think the
upcoming year will be an exciting time for our industry ... Broadband technology will
continue to improve and with those improvements we shall see more and more content on the
web. Full screen video, voice over IP (Internet Protocol), and lightning fast data backup
will be enjoyed by the masses. When broadband matures, as it has with our wireless product
Beam Access, many new ways of utilizing the Net will be evident and invention shall become
the mother of necessity," says Edgerton.

James Tsai, software engineer at American Systems Management, Inc. predicts that
households will become increasingly "wired" and intercommunicative.

"The most exciting pieces of technology to watch for that will facilitate [the increased
presence of the Internet] will probably be Bluetooth technology, which will allow all
sorts of normal household appliances to talk to each other over the Internet. This Smart
House of the future will allow for vacationing families to check up on home, or be able to
look up a song or movie they want to play from another room," says Tsai.

Industrial businesses will also benefit from these new technologies. According to Michael
Ewen, owner of PCTI.net, manufacturers are increasingly integrating personal computers
into the workplace and making it more efficient.

"[Some] manufacturing is now computerized, adding [computerized machines] that lathe, cut
wood, welders that make patterns through sheets of metal. Companies now train employees on
computers, not [industrial] machines and help people with specific industry programs,"
says Ewen.

Computers and increased online connectivity is also rising in the workplace. The Microsoft
Tablet, expected in the first quarter of 2003, is a half-inch thick computer with a 15
inch flat screen that can be placed flat, like a piece of paper and written on with a
stylus.

Ewen notes its especial functionality in the business world: ideal for sellers and
manufacturers to do online inventory, it is tailored for larger corporations with
warehouse and factory space but is equally useful for smaller businessmen with salesmen
and technicians frequently out of the office. Within the office, businesses now want Web
sites that "are past the brochure phase."

Companies now want databases that allow office information to be available offsite or Web
sites that can give clients customized information on their orders.

Known as the "back end office" or "private virtual network," the network allows employees
with the right tools and accessibility to log on to localized data within their company,
in the office, traveling, or at home.

Robert Kurhajetz, a computer specialist for the U.S. Navy, predicts that these "remote
offices" will make companies rethink their staffing policies, allowing more employees to
work at home, avoiding a commute, while the businesses may enjoy a lower overhead.

Technological advancement may render some companies obsolete. Because of increasingly
competitive markets, Barbara Kurshan expects lots of consolidation, such as the merger
between Hewlett Packard and Compaq, and predicts "smaller computer companies will not be
around" in the next five years.

Jeremy Barbour of Verizon expects similar things to happen in the cellular industry when a
global signal, or Wideband Code Division Multiple Access (wCDMA), is established, allowing
all cell phones to be on a global satellite network, making roaming a thing of the past.
Smaller localized companies will not be able to compete with larger conglomerates such as
Verizon, Cingular, AT&T, and Nextel.

Companies just recovering from the decline of the last two years can take heart, however.
George Shen, owner of PC City Computers, thinks that the technology industry is now
stabilized, after the failure of many companies without a sound business strategy.

"It's a cycle; it's normal. Look at the automobile industry in the 1920s-1940s. [The
downturn] is a natural way to pick out excellent companies [with] good service, good
technology, and good management," says Shen.

For Virginians, the technology sector may begin to rebound. Gov. Warner's and Secretary of
Technology George C. Newstrom's "Commonwealth of Virginia Strategic Plan for Technology
2002-2006" outlines eight technology initiatives. They would "consolidate the IT
[information technology] infrastructure and reorganize and manage IT, increase online
services, bring broadband to all of Virginia, "increase commercialization of intellectual
property," and " 'grow' " more technologically based companies. Warner also hopes to
funnel more federal research and development money into Virginia colleges and
universities, attracting 20 percent more federal funding, or $57 million, by the end of
the fiscal year of 2003, according to the strategic plan. Federal money will assist in
other areas as well.

"With the new Homeland Security Department kicking off, many industries will pick up.
We've already seen previously small bio-metric companies get a lot of revenue from the
government as they develop airport security systems," says Tsai.

Within the Blue Ridge Region, the New Century Technology Council provides leadership to
technology firms in the Roanoke and New River valleys. Jay Foster, a board member of NCTC
and president of SoftSolutions, Inc., says he values the networking opportunities and
"regional economic focus."

"There are tremendous resources both in Roanoke and the NRV for technology firms to
leverage. The NCTC is one of the only voices I know that unites these two important areas
as a single economic region," says Foster.

No matter how advanced technology becomes, there is still no crystal ball to the future.
Tracking one technology is easy, but the convergence of technologies, such as the
combination of cellular capabilities and the Internet, makes it more difficult to predict
which technologies will take root, warns Kurhajetz.

3G cellular and forms of Wi-Fi still depend on how they will be introduced, accepted, and
implemented before they can be considered successful. Innovations may slow down, but not
perceptibly to the consumers, says Kurshan. With a better focus on technology from the
governor and realistic expectations from consumers and investors alike, 2003 may be a
recovery year, with slow but steady growth thereafter.

(Tracy D'Souza is a Roanoke-based freelance writer.)

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