Technology Futures

The new Kindle DX by Amazon is out. It's a bigger version the older Kindles, and the main feature is a much bigger screen. The gadget cost $489, but some of that goes toward the free connectivity on the Sprint cellular network. You can download books and news via the wireless link, and recent novels start at $10.

While leveraging almost everywhere cellular connectivity is clever, it limits the device's usefulness as a substitute for a full-fledged computer for Web access. The slower cellular data speeds are fine for downloading a book and then reading it offline, but trying to read the New York Times in the morning over a cellular data link is likely to be pokey, and the whole connectivity model does not scale up well once lots of people have the device. AT&T's 3G network can barely handle the still small number of iPhones.

Kindle will pave the way for better devices with color screens and WiFi connectivity to news and books. Kindle may also help publishers finally make the pricing and business model shift to better accommodate selling books in electronic format.

But there is still another shoe to drop: Apple has been making veiled hints about "new and interesting" devices, that many think could be a tablet iPhone. It would not take much to do that, as the iPhone is already a full-fledged computer running a modern, open source version of Unix. If Apple releases a tablet version of the iPod Touch this summer (an iPhone without the cellular phone but everything else), Kindle will fade quickly into obscurity.

I am back from three days at the Broadband Properties annual conference. As more communities make investments in broadband infrastructure, we are beginning to get some interesting data back on the economic impact.

In Anson, Indiana, a developer is putting duct and fiber to 1790 homes and 9 million square feet of commercial and retail space--all part of a master planned community. The investment has brought an Amazon distribution center and 1200 jobs to the community.

In Orlando, Florida, the Lake Nona planned community is building one of the nation's largest set of medical facilities, with more than 5 million square feet of specialty clinics, hospitals, and medical facilities. One million square feet of retail is planned, and 5400 housing units are being built. There will be fiber to every single premise.

In the rural Hill Country near Austin, Texas, the local telephone coop is building fiber to the home, and says that the initiative has retained 150 jobs and added 200 new jobs. The coop works closely with local economic developers, who are pushing hard to get the right telecom infrastructure to be able to meet any business need.

Economic developers in other parts of the country need to be asking: "How do our regions compare with these kinds of projects? How will we convince companies to come to our region when these other communities have world class telecom infrastructure?"

A new report by Nielsen says time spent watching video online has increased in the past five years by 2,000%. And the number of people watching video online is increasing by 10% per year, meaning in about seven years, everyone will be watching video on the Internet. TV is dead, dead, dead.

And as I have been saying for years, the Internet business model being used today by the incumbents and smaller providers is upside down and unsustainable--bandwidth by the bucket does not work when users are asking to refill the bucket faster and faster each day, week, and month. And charging to refill the bucket does not scale up, as the bandwidth quickly becomes unaffordable when watching lots of video.

The solution is to change the business model. It's not hard, and the incumbent providers would actually make more money after the conversion. But some of them are going to go bankrupt rather than admit they need to change.

Here is a nice little table that compares the price of broadband in various places around the world. Stockholm's municipal fiber network has the best pricing: $11 per month for 100/100 megabits (symmetric). Compare that to some U.S. offerings like one incumbent's 50/20 megabit (asymmetric, less than half the capacity) service for $145.