Dan Farber reports on my presentation at PC Forum.

At PC Forum Novatium Solutions demoed its $100 PC appliance (without keyboard or display, which adds about $75) for emerging markets. The Nova netPC and Nova netTV are based on thin client (server-based, zero administration for users) and mobile phone technology. "We have the guts of mobile phone and use the business model of phone industry," said Rajesh Jain, co-founder of the Mumbai, India-based company. "We reduce the price of the thin client by about 50 percent, moving away from the Intel architecture, and change the business model to suit emerging market customers." It's like a cell phone in square box and a bunch of I/O ports.

The core processor is an AMD digital signal processor, rather than x86 architecture, used in cell phones, and works over LAN, Wi-Fi and broadband networks. (After the session an Intel representative was primed to talk to Jain.) The only client side processing is for the display and multimedia, and the maxiumun video display is 1024x768. The device also supports standard I/0 ports and outputs only 5 watts. A future edition could include DSL on the motherboard. Jain expects that the base price will remain steady over time as new features are added and as volume sales increase.

Software is provided at $10 per month, and supports Unix and Windows terminal services. The license for Windows software and terminal services has to be purchased separately, but an open source, Linux-based desktop stack is available for free. "There is a growing flexibility to look at monthly pricing cycles, including from Microsoft," Jain said. Since few people in many emerging markets pay for software, having server-based subscriptions could reduce piracy, he said.

Will do a more detailed write-up as part of Tech Talk next week on my PC Forum presentation.

WSJ writes:

Multinational companies, drawn by a huge and inexpensive talent pool, are pouring money into research and development in China -- a trend that promises to broaden the country's huge role in the global economy.

The total number of foreign-invested R&D centers in the country has surged to about 750 from 200 four years ago, according to China's Ministry of Commerce. And in a survey of multinationals published in September by the United Nations Conference on Trade and Development, China was by far the most frequently cited location for R&D expansion, well ahead of the U.S. and third-place India, China's chief rival as an emerging innovator.

Still, China's growth as a global R&D hub faces some constraints. Among them is the country's weak protection of patents and other intellectual-property rights. That has encouraged some foreign companies, fearful of risking their trade secrets, to keep more cutting-edge research out of China, analysts say.

Thomas Husson asks if it is hype or reality:

Let's go step by step:

- mobile TV is a nascent market, built by mobile operators to sell 3G
- adoption rate is so far extremly dependant on the 3G installed base
- the current time spent watching TV (2 minutes / session) is nothing but a show-off service. Look I have live TV on my mobile!
- Japan and Korea are not that advanced market as far as mobile TV is concerned. Yes, S-DMB is available since June 2005 but it has only reached 300,000 subscribers in 6 months. Yes, T-DMB is available since December 2005, but it is offered for free and consequently mobile operators are not really backing the project due to the lack of a sustainable business model.
- when it will reach critical mass, 3G will not be the ideal solution if many customers want to watch the same live content simultaneously.
- mobile operators have invested billions in 3G. Do you think they will so easily say to their shareholders: let's build a new network from scratch? My take is that MBMS is the natural next step since it allows carriers to use their existing infrastructure and that the spectrum is available.

I am not saying they should use this technology. I am only saying they should try it, because we are at a trial stage. Ericsson and IP Wireless (on the TDD spectrum) are pushing it. Alcatel is now promoting a satellite-base mobile TV solution as well.

There is no rush to decide which technology to use. Anyway, it is just another standard war. As always, technology is not really the issue. The real question is about the business model. Which technology is likely to generate volumes and consequently economies of scale on a worldwide basis?

Pete Cashmore writes about Edgeio, iNods, Kritx, Reevoo and Toshiba.

it isn’t going to be plain sailing for the edge aggregators. The low barrier to entry means that all these services will face defensibility issues - what’s to stop a barrage of newcomers aggregating exactly the same content? Being early in the game may lead to beneficial network effects, but maintaining this advantage is always a challenge. What’s more, services like Edgeio plan to transfer content both in and out of the system - it seems plausible that others could take advantage of the resulting output, with or without Edgeio’s explicit permission. Yet more critics wonder whether the need to have a blog may limit the potential of such aggregators. Personally, I don’t see this as a critical issue: edge feeders allow you to create syndicated content without owning a blog, and even centralized sites may see the benefit in becoming edge feeders and/or aggregators.

Dion Hinchcliffe writes: "social interaction can range from being nothing more than a one-on-one experience, all the way up to a very large private social club. Or it can even be the entire world. Likewise, the temporal aspect of social interaction seems to be extremely important. It can be intense, real-time communication via instant messaging or MMOG interaction. Or it might be regularly periodic, like e-mail. Increasingly common, it can even be completely aperiodic or once ever, like referring to a social bookmark or social guide. The only thing this seems to miss is the increasingly multimedia social experience that involves audio, video, and more."

Peter Fingar writes in his book “Extreme Competition:”

We are, perhaps, in the midst of one of the greatest business transformations ever in the industrialized world, a transformation that is being shaped by five key drivers: 1. knowledge as business capital, 2. the Internet, 3. jumbo transportation, 4. three billion new capitalists, and 5. the New IT, where business automation focuses on outward-facing business processes, not back office record keeping. Together, the results of these forces are far greater than the sum of the parts—and they are of historic proportions.

1. Knowledge as Business Capital

Specialized knowledge leads to a new kind of workforce with intellectual knowledge workers, such as scientists, able to claim an “intellectual capital” stake in wealth in the way that industrialists claimed a stake in wealth through monetary capital.

Just as skilled and semiskilled manual workers in factories represented a middle class in the 20th century, workers with specialized practical knowledge (engineers, technologists and technicians) are becoming the dominant economic force. Specialized schooling and certification will replace the apprenticeships of blue-collar workers of the past.

And, with the exception of tasks requiring that a technician work on site with their hands (X-ray technicians, nurses, physical therapists, psychiatric counselors, network cable installers and dental hygienists), such work can be carried out virtually anywhere (today lab tests for patients in New York are analyzed in New Delhi).

2. The Internet

It’s not your father’s Internet anymore. But, then again it may not wind up being Google’s Internet anymore, either. While acknowledging the risks inherent in any start-up venture, Indian Internet pioneer, Rajesh Jain speaks eagerly of what he calls the phenomenon of the black swan—a rare, but not impossible, event. “Google was a black swan,” he said. “No one expects the next Microsoft or Intel or Cisco to come out of India, but I believe it is entirely possible.” Will Jain out-Google Google? Stay tuned.

The issues that businesses now face have never been larger or more imposing than those posed by the Internet and its potential to restructure the whole economy to achieve heretofore unattainable efficiencies and efficacies in getting work done. Traditional supply chains of the industrial economy are being transformed by “value chains of knowledge.” The transformation is well under way—there is no turning back.

3. Jumbo Transportation

“Megalogistics,” made possible by awe-inspiring jumbo jets and jumbo cargo ships, is a key driver of globalization, and just-in-time manufacturing. Just about anything can be shipped within 36 hours, from anywhere in the world, to anywhere in the world.
…
While the Internet is clearly recognized as a marvel of modern business, extreme competition is also being driven by these physical marvels of extreme logistics. Globalization is a two-sided coin, with Internet connected knowledge work on one side, and extreme logistics on the other; both shrinking the world to where nations-state boundaries are being erased in a global economy. Opportunities—and challenges—of this shrinking world apply to huge corporations and sole proprietors alike.

Tomorrow: Five Drivers (continued)