TIME has a nice story discussing how it came about:

The iPhone developed the way a lot of cool things do: with a notion. A few years ago Jobs noticed how many development dollars were being spent—particularly in the greater Seattle metropolitan area—on what are called tablet PCs: flat, portable computers that work with a touchscreen instead of a mouse and keyboard. Jobs, being Jobs, figured he could do better, so he had Apple engineers noodle around with a better touchscreen. When they showed him the screen they came up with, he got excited. So excited that he thought he had the beginnings of a new product.
...
Two and a half years ago, Jobs sicced his wrecking crew of designers and engineers on the cell phone as we know and hate it. They began by melting the face off a video iPod. No clickwheel, no keypad. They sheared off the entire front and replaced it with a huge, bright, vivid screen—that touchscreen Jobs got so excited about a few paragraphs ago. When you need to dial, it shows you a keypad; when you need other buttons, the screen serves them up. When you want to watch a video, the buttons disappear. Suddenly, the interface isn't fixed and rigid, it's fluid and molten. Software replaces hardware.

From Information Architects Japan:

1. Apple keeps its iPod monopoly and increases its OS 5% market share to 5.1%
2. Google scores against Microsoft and Yahoo due to its massive marketing data advantage
3. Blogs bloom, and prepare for the 2008 election
4. Social networks become a place where members make money
5. Newspapers open up
6. Big ad investments start streaming in
7. New Internet focused ad agencies open up
8. Viruses and spam become an even bigger hassle
9. Yet Digital ID initiates a major change that makes the web more reliable, user and investor friendly
10. All in all 2007 is a preparation for the big infolution in 2008

Joshua Porter discusses a quote by John Brockman: "WE WILL SEE migration of social applications as user-generated content moves to the WiFi environment. YouTube, MySpace and multi-user games will be available on hand-held devices, wherever you go. People will carry their digital assets much like their bacteria. Israeli tech guru Yossi Vardi calls it 'continuous computing.'"

Joshua adds: "I like that term: 'continuous computing'. It’s catchy, and it suggests that computing is becoming a commonplace part of our lives. However, what we’re really doing isn’t 'computing', but simply socializing. We happen to be using computers to help us. That may sound like a small distinction, but I think it’s important to realize that although we’re using computers, they’re only enabling us to do more social things. We’re not being social because of computers…we’re wired to be social anyway."

Sadagopan writes:

1. Offshore majors would work on coming out with a viable approach towards offerings centered on disruptive technologies like SaaS. Global majors may work hard to demonstrate better value add to their customers leveraging their offshore presence.

2. New breed of offshoring players with different business models shall spring up. Innovation in services space would continue to come out of India.

3. We may further see change in the rankings and growth rates amongst the top 10 offshore players change based on their business models and their organizational strengths. The era of an almost automatic growth is giving way to more deterministic models of growth pursued with deliberation and delivered effectively.

4. The threat to the offshoring services industry would be coming in form the IT infrastructure utilities - though this may be few years away. We may see some pioneering efforts by a few business units in adopting these and may also see offshore providers coming up with hybrid approaches to adopting to IT utilities(as part of their evolution)

Dave Winer outlines a list for companies he is looking for participating in the next Under the Radar conference. It is a good list for thinking about the various software categories:

1. Organize - Tasks, Database, Project, Notes, Bookmarks,

2. Collaborate - Groups, Wikis, Spreadsheets, Word Processing, File Sending, Document Management

3. Track - Time, Expenses, Budgets, Accounting, HR

4. Publish - Blog platforms, Web publishing, Feeds/RSS, Content Management

5. Communicate - Email, IM, VOIP, Voice, web conferencing

6. Create - Presentation Mngr, music, photo edit/manage

7. Personalize - Desktop, Calendar, personal organizers

8. Search - vertical, social, create your own

9. Voice calls are becoming free. For telecom companies, it is their worst nightmare come true. Voice, which has sustained their business models for decades, is now becoming near-free on wired networks, thanks to the likes of Skype and others. Even in India, there is talk of creating a flat-rate for nationwide long distance calls, eliminating the earlier practice of distance-based pricing. It is only a matter of time before the Internet makes voice just another service on the digital infrastructure. The implications of free voice are many. For example, one could not just click on an ad to go a website but click to be connected to a person at the other end. Distance means little as loved ones can now communicate more often irrespective of where they are. For telecom companies, it means reinventing themselves as we are now seeing them do.

Update: Skype continues to grow, extending its voice application to also support video. In India, telecom costs have fallen dramatically. While not exactly free, pricing is now at a rupee a minute for long-distance calling within the country on landlines and about double that on mobile phones.

10. Software-as-a-service is happening. Yet another old model is being reinvented. Google did it to Search and online advertising, while Salesforce.com is doing it for software delivery. The traditional model of licencing software is giving way to making applications available over the Internet for companies to use. This is especially useful for small- and medium-sized enterprises who can now automate business processes without necessarily having to make big upfront investments in expensive hardware and software.

Update: SaaS continues to grow, though it has still to make deep inroads into India. One of the bottlenecks is the lack of cheap, reliable broadband connectivity. But I do expect it to grow, as Indian companies automate operations. They can skip intervening generations to go directly to the SaaS-based world. This will likely be seen in small- to medium-sized enterprises first who have no legacy to worry about.

11. Emerging markets are where the action is. Because their infrastructure has been so pathetic, emerging markets will leapfrog to the new world faster. We have already seen this in India with the mobile infrastructure. Emerging markets are going to decide technology’s next big winners (and losers). Even companies like Vodafone are now betting on emerging markets for their own continued growth. The next billion people are finally getting integrated into the marketplace – and that will create its own challenges and opportunities. I believe that the next Google will come from the world’s emerging markets.

Update: This is accepted even more now than ever before. Cisco is moving some of its senior staff to India to capitalise on growth. Motorola is betting on India for its future mobile business growth. One of India's leading mobile operators, Hutch, has seen its valuation jump almost 75% in a month as bidders vie to get a piece of the action. The next Google is yet to emerge, but perhaps it has already been born somewhere!

Tomorrow: Musings