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MAY 25, 2004
SPECIAL REPORT: CEBIT 2004

CeBIT on the Hudson
Europe's giant tech show comes to New York, bringing an IT vision dominated by smaller PCs, faster access, and multipurpose hybrids


It might seem strange, but the Computer Age is starting to wane. That's not to suggest that people will go back to writing their memos on Remington typewriters or balancing their books with electronic adding machines. But in a few years, the idea of the big desktop-computer flanked by a clunky keyboard, monitor, and printer may seem just as antiquated.


That setup is being replaced by a new generation of wireless phones, handheld devices, and tiny digital sensors that will soon outnumber PCs by a margin to 10-to-1. "As these devices catch on," says technology analyst Crawford Del Prete of researcher IDC, "they will redefine the very meaning of computing and change the way people work and live."

For a glimpse of what this fast-approaching future will look like, take a stroll down the aisles of CeBIT, the big European tech show that has made its way to America. The U.S. show, running May 25-27 at the Jacob Javits Center in New York, is smaller than the European version, which occupies as many as 27 halls of the giant exhibition center in Hanover, Germany. Still, it's a good barometer of the changes that are sweeping through the world of info tech.

The proliferation of new devices and faster, more efficient infrastructure should fuel the tech sector for years to come. No one expects it to match the 15% annual growth it achieved in the '90s, but it should sustain solid gains in the mid-single digits until at least 2008, according to Del Prete, who will be speaking at CeBIT on Tuesday, May 25. (For a Q&A with Del Prete, see "Tech Steps Out of Its Foxhole.")

MICRO MARVEL.  The range of new, hybrid computing devices is staggering. The trend began a few years ago with the appearance of Research In Motion's (RIMM ) BlackBerry, which allows users to send and receive e-mail, surf the Net, and manage their contacts with a pocket-size communicator. It continued last year with the appearance of PalmOne's (PLMO ) Treo 600, which added a mobile phone and a keyboard to a Palm organizer.

The next step will be devices that combine these features with the power of a laptop. OQO, a San Francisco outfit created by veterans of Apple Computer (AAPL ) and (IBM ), set out to build the world's smallest laptop. Less than 5 inches wide and weighing only 14 ounces, the OQO is easy to drop into a briefcase or even a purse. But it has the power of a full laptop loaded with Windows XP, and it includes Wi-Fi for high-speed wireless Internet access. The device, which will be demonstrated at CeBIT, will be available in the second half of 2004.

Indeed, mobility is redefining the world of tech. As small Wi-Fi enabled devices like the OQO hit the market, they're becoming an increasingly viable alternative to regular phones. Simply plug a headset into the OQO within range of a Wi-Fi connection, and you can make free phone calls with Internet technology.

QUICK RESPONSE.  The innovations aren't just limited to Wi-Fi. Wireless phone carrier Nextel Communications (NXTL ) will be unveiling a pint-size credit-card reader that attaches to a cell phone. Combined with a tiny printer, it will allow a plumber, electrician, limo driver, or pizza delivery man to accept a credit-card payment and issue a receipt while in the field.

While mobile credit-card readers have been around for some time, Nextel says its system is cheaper because it's based on the regular wireless phone network. "Anyone can use this technology with a minimal investment," says Jerry Reynolds, vice-president of Nextel's New York region."

Over the next 15 years, tiny wireless sensors will be embedded in almost every product, from light bulbs to tubes of toothpaste. These miniature transmitters are based on radio-frequency identification technology, which is familiar to many drivers who use windshield-mounted RFID tags so they can slip through highway tolls booths with a minimum of delay. A scanner at the booth reads the driver's tag number and automatically bills a credit card.

BEEFIER BACK ENDS.  Over the next few years, companies like Best Buy (BBY ) and Wal-Mart (WMT ) will use RFID tags to track the flow of goods around the world. They'll know if a shipment is late or if a store is running low on supplies of a particular product. Best of all, they'll be able to respond in real time to these changes in the market.

The proliferation of new devices will generate huge amounts of data and place enormous stress on corporate networks. Companies will have to beef up their IT infrastructure over the next few years, goosing demand for more powerful hardware. NEC (NIPNY ), IBM, and Intel (INTC ) plan to announce at CeBIT a new partnership that will help companies manage all that information. They will combine NEC's new 64-bit mainframe computer with IBM's database software and Intel's Itanium chip.

NEC also plans to unveil technology that will speed up corporate intranets, even as they become more crowded with data. As for the Internet, NEC estimates that the technology will make access as much as 20 times faster than it is today.

CHEAPER AND FASTER.  Big changes in the software sector are necessary, too. As the range of devices and data becomes ever larger, companies are consolidating the number of systems they use to manage the traffic. Holland-based outfit Exact Software is helping customers eliminate layers of incompatible software by rolling out a single product to handle a whole range of business functions, from sales and marketing to administration and human resources. That means customers will require fewer vendors or technology platforms. By using a bundle of software from a single supplier, customer can reduce costs and make it easier for employees and customers to communicate.

As this new technology enters the market, people will have the ability to work from almost anywhere using tiny, powerful mobile devices. When that happens, who'll need a big desktop PC?



By Steve Rosenbush in New York

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