Wall Street Journal writes about the rising popularity of Ajax:

Ajax, which stands for "Asynchronous JavaScript and XML," helps make Web-based programs nearly as responsive as software that resides on a user's computer. The technique helps speed up computer operations by cutting down on the need to request fresh Web pages from a distant server computer. Instead, Ajax applications can request smaller chunks of data to update a Web page already on a user's screen.

As a result, Internet-based programs viewed inside Web browsers, such as instant messaging or email, can now behave more like bulkier software that resides on a desktop computer. Some of these Internet-based programs can also be cheaper to buy than desktop software, posing a potential threat to the likes of Microsoft's ubiquitous Office word-processing suite. Microsoft, however, notes that desktop products like Office have successfully weathered many technological challenges over the years.

Dan Farber writes about a talk given by Cassatt's Bill Coleman:

Last week, Coleman gave a presentation of the Vortex 2005 conference in San Francisco, predicting that the next generation of consolidation will result in the end of “every telco, cable, ISV and portal company. It will morph into something else, with all companies buying capacity on demand.” Utility computing will eliminate operating expense costs and rely on the using the cheapest components to build large scale systems, he added.

In other words, the Internet will be the hub for all content and communications (VoIP, IPTV, etc.), computing components will be standardized and cheap, and new utilities will spring up just as Yahoo, Google, Amazon and eBay have sprouted in the last decade. The existing infrastructure companies either morph into the new era or disappear.

This transformation will be similar to what has gone on in the cellular communications industry, a battleground increasingly fewer border constraints (the Internet), and the economics, and history, dictate that only a handful of suppliers will be left standing over the next decade or two.

Michael Parekh writes in the context of Google's advertising model where advertisers can bid pennies:

This is one of the first large-scale, real-world empirical validations of something many have argued since the earliest days of internet commercialization over a decade ago. That is the notion that micro-payments in pennies could be very big for commerce on the internet (aka e-commerce). Ten years later, we have yet to making this a reality on the e-commerce side of the web, both on PCs and on wireless devices like cellphones, the success of eBay's Paypal notwithstanding.

The path to fame and fortune from nickels and dimes is not new in America. Frank Woolworth hit on the formula back in nineteenth century, when he founded the F.W. Woolworth "five and dime" chain of stores. It lead to one of the largest retail fortunes in the land, selling "discounted general merchandise at fixed prices, usually five or ten cents, undercutting the prices of local merchants" (from Wikipedia).

It's ironic that the value of penny-driven commerce on a large scale is first illustrated on the advertising/marketing front rather than the e-commerce front, as long expected. I daresay it might be equally powerful in the third major form of Internet revenue streams: subscriptions. That is, the notion that one can subscribe to something for pennies over a period may be very powerful for content, commerce, and web services on the internet.

Kevin Werbach asks:

The traditional telecom pricing model is to charge for the basic service (voice connectivity), and you get other things on top for free. That model has largely been replicated on the Internet -- users pay access providers, and applications like Yahoo!, Google, and Amazon.com have to find ways to monetize something other than access. A good part of the dotcom bubble was due to the fact that Web-based companies couldn't "monetize" their traffic, and charging users directly was off the table. The companies that weathered the storm and prospered figured out alternative revenue streams. (Value-added services for Yahoo!, contextual advertising for Google, and transactions for Amazon.)

Now, along comes the broadband Internet. We seem to be proceeding in the same direction, with application providers finding indirect ways to monetize their usage.

But what if the connectivity were free, the applications were free, and users paid only for the add-ons? Could that ever work?

WSJ writes:

A decade after they began encouraging spenders to put everyday purchases on plastic, financial institutions now want people to use them for even smaller transactions. Known as "micropayments," these transactions typically are less than $2 and can ring up sizable industry profits even when they are less than a dollar.

After making a big appearance in online transactions a few years ago with the ability to charge a 99-cent song downloaded from Apple Computer Inc.'s iTunes, tiny payments now are showing up more often in the physical world.

The push toward smaller transactions is part of the credit-card industry's continuing strategy of getting consumers to use plastic instead of more traditional forms of payment. Consumers already are moving in that direction: The number of U.S. electronic payments topped the number of cash and check payments in 2003 for the first time, according to a study conducted by the American Bankers Association and Dove Consulting, a Boston consulting firm. Cash and checks now account for 45% of consumers' monthly payments, down from 57% in 2001 and 49% in 2003, according to the latest version of the study, issued last week.

Over the past 18 or so months, I have been working to bring the "Emergic Ecosystem" to life. I see this future as built around thin access devices ["teleputers" or mobile network computers – the intersection of network computers and mobile phones] connected to centralised services over broadband wired and wireless networks. This two-way, multimedia web will get created first in emerging markets like India where there is limited legacy.

Every once in a while comes a platform shift in computing which creates new opportunities. We saw that shift in the early 1980s as the personal computing platform started to replace the world of centralized mainframes and mini-computers. We are in the midst of another such shift now as network-centric computing (with Ajax-ish interfaces) and broadband networks convert the desktop computers into terminals to connect to the Internet. The PC world shifted power away from the likes of IBM and created Intel and Microsoft. For the past two decades, Microsoft has reigned as the king of the computing world. Now, Google is the challenger and potential heir to Microsoft’s throne.

I believe that even as there is the shift taking place to network computing and virtual applications, we are seeing the emergence of the next platform. This platform will take root first amongst users in emerging markets – those who haven’t completely experienced or benefited from the computing and Internet revolution. This leapfrog represents an opportunity to build the next computing and media giant. This new platform is what I call the “mobile network computer.”

This is the thinking that drives us in Netcore as we expand beyond our messaging and security solutions business to provide software-as-a-service solutions to SMEs, integrated
with mobility. Netcore, based in Mumbai, is where I spent 70% of my time. I think of it as the keystone for the ecosystem.

In addition, outside of Netcore, I have invested in/helped co-found a number of companies as part of the "Emergic ecosystem":

Novatium: thin clients (with Ray Stata - founder-chairman of Analog Devices - and Prof. Ashok Jhunjhunwala - Tenet Group, IIT-Madras). We are building sub-$100 multimedia-enabled network computers. More information is available on Novatium’s website.

Seraja: with Prof. Ramesh Jain of UC, Irvine (next-gen search platforms). The focus is on building the Event Web. You can read more about the ideas on Ramesh Jain's weblog.

Rajshri Media: broadband and mobile content with Rajshri Productions, one of India's largest and most respected entertainment companies.

I have also invested in Midas and n-Logue (both from the Tenet group at IIT-Madras). Midas builds communications equipment. It was named by Business Today recently as one the 20 companies to watch in 2006. n-Logue focuses on rural services and operates a network of over 2,000 kiosks.

I have also invested in New York-based PubSub.com, which focuses on real-time search and notifications.

I think about what I am doing as blending entrepreneurship and thesis-based investing. Will it pay off? I hope so. As I like to think, the future is an instantiation of someone’s vision. So, why cannot it be ours?