Vision

The pace at which IT and telecommunications grow depends on a number of factors. When a new technology is introduced, there are always a number of barriers that have to be overcome before the technology is applied on a large scale. The time required for the expansion of the technology strongly depends on a number of things, including:

• the number of possible applications and the relevance of these applications;
• the investments required and the expected return;
• the number of people and or companies that will eventually be using the technology;
• the complexity of the learning process for people and companies.

   

  1.4.1 Barriers

  Below, an overview is given of the barriers that will at first hinder and delay the growth of IT.

  Large investments
  Building infrastructure usually requires large investments from companies and private individuals. The IT infrastructure is also very expensive. It includes, for example, a workstation on each desk, a complete home system in each home and mobile telecommunications equipment in every car. Larger companies need larger supporting computers and a larger internal company network. The most important investment in the infrastructure lies between the companies and the homes: the Digital Highway, connecting everybody. Because of their size, the investments will have to be made gradually. Fortunately, the costs of new telecommunications networks are not so high, compared to the other investments in IT. A close co-operation is of course required between the various parties involved with telecommunications, such as telecommunications companies and cable (television) companies. It is a government tasks to stimulate this co-operation, for example by abolishing existing monopolies of (former) state enterprises. In The Netherlands this is currently happening with the former PTT (Post Office and Telecommunications). The Dutch Government actively stimulates the construction of the Digital Highway.

  Lack of standards
  As is the case with every new technology, the problem with IT at the moment is a lack of the required standards. To be able to connect hardware, applications, people and companies via the network and to enable them to actually co-operate, requires standards. Currently, as opposed to the initial phase of IT, the hardware of different suppliers is becoming more and more compatible. The standards for applications, software as well as data, still have to take shape for the most part. Unilateral standards imposed by the government or by market leaders have turned out to be unpractical. A better chance of success is offered by the use of a growth strategy, in which standards emerge in practice, which are then adapted. The ensuing standard then includes the experience of real applications. This is what we call the ‘de facto’ standards. It takes time for such standards to develop. Once a complete set of standards has been established, this will immediately be followed by a rapid growth of the number of applications of the new technology. The IT world has progressed a great deal, but still has a long way to go.

  Security
  Security problems will grow along with computer networks and applications. These problems have to be solved within the framework of the technology that has to be secured. Practical experience in this field is indispensable. Improvements will often be made by trial and error. A great handicap is the fact that companies are becoming increasingly dependent on good and reliable computer networks. The breakdown of important connections, the loss of essential data and small, but persistent malfunctions can cause a company and its customers great damage. Computer viruses, for example, small, well-hidden programmes that are sneaked into the computer together with other programmes, can cause enormous damage to databases of companies or private individuals. The security of data when stored in databases and when sent through the network, therefore requires serious attention. Security against ‘break-ins’ in computer systems has also turned out to be necessary. Sensitive, personal information, company secrets, commercial multimedia products, software; all of these are being sent via the network more and more often. The current technology does not offer enough facilities to properly meet security requirements. The technology is not sophisticated enough yet to be able to work really safe on a large scale. To change this, additional investments of both companies and private individuals are required. For the security of privacy and ownership, for example, it is absolutely necessary that it is known to whom data and applications belong. That is the only way to properly settle access rights and usage rights and to ensure payment. A possibility in this respect is for companies to offer private individuals the use of ‘data safes’ as part of the network, in which they can safely store their personal data. Thus, the electronic network would become one – strongly decentralised – source of such personal data.

  The economic value of immaterial products
  A specific problem is presented by the economic value of immaterial ‘goods’. Companies enter their material assets on their balance sheet against certain accepted valuation standards. Accepted standards also exist concerning gradual depreciation caused by wear and tear and ageing. All this is not so clear-cut when it comes to the value of immaterial ‘goods’. We are referring to, for example, the knowledge of employees, data stored in computers of companies, text contained n books and software. All of these things are worth money, a great deal of money sometimes. How much money is often unclear, however. Accepted norms have not come to a sufficient stage of development yet.
  Companies will be needing more and more knowledge and data to be able to function properly. They will own, produce and sell increasing amounts of immaterial products. It is therefore of great importance that there are proper methods and norms for the economic valuation of immaterial assets. Only then will there be a proper foundation to add new electronic markets and the trade of immaterial goods to the economy.

  Legal problems
  The present legislation is not sufficient to regulate working with IT and telecommunications. The immaterial product is a legal problem area. With the exception of copy rights and patent rights the legislation, which we are referring to, is mainly aimed at material products. A written receipt on paper is often the only legal evidence. Electronic trade in which no paper is used at all is therefore a legal twilight zone, especially when the trade in immaterial products really takes off.
  The protection of privacy not only requires technical facilities, but also legal provisions. As the legislator, the government faces the task of creating the proper legislation in co-operation with technology experts. This legislation will, after all, have to make certain requirements of the functioning of hardware and software.
  Here, too, history repeats itself. Between 1860 and 1890, The Netherlands, along with many other countries, saw the birth of the railway legislation. It prescribed safety regulations such as the signalling system and the air brake system. The law forced many railway companies to introduce these safety measures. These had been left out until then, because of the high costs. The measures stimulated the growth of railway transport, since more trains were able to travel along the same line at higher speed. The improved security led to an improved service and an increased usage.

  Size and complexity of the change
  The pace at which IT grows will on the one hand strongly depend on the pace at which people acquire IT knowledge and experience and on the other hand on the effort made to actually realise and open up the world-wide IT infrastructure. The Information Revolution involves great and complex changes. These require time, especially when we take into account that the number of people involved is enormous, for eventually almost everybody will be dealing with it. Not only will the way of working and living change radically for many people, it will also require a great deal of time to discover and realise all the new possibilities IT offers with respect to products, services and organisation. It may take a full generation (around 30 years) to go through this process of learning, adapting and familiarisation. The pace at which this learning process is integrated in current education provides us with a good standard with which to measure how the process is advancing at a social level. It is important that people’s education closely follows new stages of development that are currently being realised. This prevents the gradual growth from slowing down.

  Social inertia and reflection
  Great changes involve great risks. People, organisations and society have a certain innate inertia that slows down changes. The people who pursue the changes often refer to this as a ‘resistance to change’ and a hidden collective tendency towards conservatism. Seen from a more positive angle, this inertia gives room for reflection, ripening of ideas and a well-balanced implementation. In view of the size of the changes and the risks involved, the Information Revolution certainly endorses the old saying ‘look before you leap’. We should not only consider financial and economic risks. The changes also involve drastic social and cultural changes, addressing prevailing norms and values. This places social inertia in a different light. The prevailing norms and values provide us with an inner security and a foothold to bring permanence and coherence into our lives and our organisations. Especially now, many old norms and values are already disappearing. There is therefore an urgent need to build up new norms and values, but this will also require a great deal of reflection and time.
  As pointed out, the Information Revolution will lead to drastic changes. Methods and forms of co-operation and people’s ways of living and working will therefore change radically. Large, hierarchically organised companies are currently undergoing a fundamental change: they are being ‘tilted’. After all, the market enforces an increasingly service-oriented and flexible way of working. This means that companies are more and more redesigning their organisation to become internal, relational networks. The internal organisational networks are characterised by more intensive communication and data exchange and therefore more specifically require the support of computer networks. Practice has shown that this transition is a very difficult one for the employees involved. A big problem for them is that they can no longer derive their significance from their position and function in the organisation, but have to derive it from the way they contribute to results. The traditional reward structure, which is based on functions and the number of hours worked rather than on results achieved, presents a barrier for the transition to a network organisation. A thorough change of the current human resource management is therefore a necessity.
  Breaking old organisational habits will – as always – take great pains. This implies that the transition from urban professional to digital nomad will take a great deal of time.

   

  1.4.2 Growing Space

  As opposed to the barriers mentioned in section 1.4.1 there are a number of factors that stimulate the growth of the application of IT and telecommunications. An overview is given below.

  The number of potential participants
  As we have described, we expect that in the long run there will be a world-wide IT infrastructure with many applications. This infrastructure will support people in many ways in business as well as personal matters. Eventually, the number of users world-wide will be immense.

  Business opportunities
  In the next few years, existing companies will strongly invest in their internal computer networks. These network systems will gradually grow along and integrate with the Digital Highway. This will gradually lead to the existence of one transparent, world-wide computer network. Administrative organisations such as banks, insurance companies and governments will use network systems to replace their current paper organisations by computer-based organisations. Businesses in all sectors will be using network systems to support internal and external communication and the co-ordination and control of tasks of people and machines. This way, companies are better able to align products and services to their customers and to deliver greater varieties of products and services. The design and implementation of new products and production processes takes place more easily and faster. The Digital Highway creates open electronic markets on which demand and supply between companies and private individuals meet.
  This presents new strategic business opportunities. In all kinds of partnerships, companies are able to produce new products and create new (electronic) markets on which they approach and service new target groups in a completely new way. By means of IT and telecommunications, business will thus thoroughly change their own scope and market positions. A new kind of competitive co-operation will arise, in which companies are associated with each other in one situation, while they compete in the next. This development will eventually lead to a redefinition of the current business sectors.

  New immaterial business
  The world-wide IT infrastructure creates new immaterial businesses. This primarily concerns the production of new electronic multimedia products which suppliers offer to consumers via the network. New service providers will settle in the network, in the capacity of co-ordinator of businesses, broker between demand and supply of products and services and collector and distributor of information in all kinds of forms.

  More exclusive products
  With assistance of IT it is possible to produce products that are exclusively tailored to the customer, with an added value. Until recently, limitation to the production of uniform products and services for reasons of control used to be common practice in for example industry, financial institutions and the government. Customers were sold uniform products and services. Customers are emancipating, however, and are becoming increasingly well-educated. They demand custom-made goods. They attach more and more value to exclusiveness, and want to have products tailored to their personal situation and wishes. Well-to-do customers are also prepared to pay more for this.
  Until now, an exclusive product involved high production costs, so that exclusiveness was limited to an elite who could afford such high costs. Network systems can help reorganise the production processes of goods and services to become flexible and inexpensive. This also applies to the design of new products and production processes. Some large companies can realise this on their own. Other companies can only achieve this by forming temporary or permanent partnerships with other companies. A number of companies in the interorganisation will specialise in producing components, while other companies will focus on combining these components into exclusive products. There will still be mass production, but it will mainly focus on the production of components.

  New inventions
  The growth of internal and external network systems with companies and private individuals will be strongest in the industrialised countries. Mass production will bring down the prices of hardware and software. This means that more and more private individuals and companies will participate in the network. Every home will first have a personal computer and later on a home system. This in turn makes it interesting for companies to sell more and more products via telecommunications networks. As a result, these networks will gradually grow to become the Digital Highway.
  As the infrastructure grows, there will be more research in this area. This will further stimulate the development. We are referring to new IT-related inventions, but also to new material and immaterial products and services, new working methods and forms of organisation. An as yet unpredictable series of new inventions will further accelerate the Information Revolution. This will not only require a great deal of flexibility, but also and particularly the preparedness to reflect, to learn and to take risks