A long way from Y2K

“Now is the accepted time to make your regular annual good resolutions. Next week you can begin paving hell with them as usual.”– Mark Twain

Dear Vorticians,

Happy new year! To modify the old Irish sentiment, may the most you wish for in 2004 be the least that you receive.

I accept as a sign of advancing age that each year seems to pass with greater rapidity than the previous one. As we ushered in 2004 under a high terror alert, I couldn’t help but recall another new year not so long ago when we all watched with a bit more trepidation than any of us would have admitted for the global computer grid to shut down because of a couple extra digits in the date field. (Skynet is in control!)

Does it really seem to you that four years have passed since the dawning of 2000? We’re already a third of the way through a decade that once loomed so large in our collective psyche. Maybe that’s because we’ve tried to block out the past few years, which haven’t been the easiest to muddle through (at least from a

business perspective.) With the tech-heavy NASDAQ index up some 50% (and over the 2,000 mark) for 2003, it’s tempting to believe that the turnaround is in full swing and the darkness has lifted. We’ve heard – and you’ve probably said yourselves – on more than a few occassions that we’ve turned the corner, bounced off the bottom, begun the ascent. I think most of us now believe that’s true (though I’ll readily admit I’ve been suckered into the same feeling before).

We know, however, that it’s not as simple as flipping a switch. The telecom industry remains mired in debt and hamstrung by slow growth. IT spending is only beginning to creep back. The venture industry has a variety of challenges to face and is likely to see a good deal of restructuring ahead. Commoditization of key technologies has depressed profits, perhaps permanently for some sectors.

But time, the great healer and the great destroyer, will sort out those things out, as it always does.

(Along those lines, I’ve always loved this riddle, which appears in J.R.R. Tolkien’s “The Hobbit.” As Gollum quizzes Bilbo:

“This thing all things devours:

Birds, beasts, trees, flowers;

Gnaws iron, bites steel;

Slays king, ruins town,

And beats high mountain down.”

The answer: Time, of course.)

But more important than the good news at hand or the remaining problems to be solved, 2004 finds us at a turning point. As I’ve discussed in the past couple of issues, the industry has been reshaped and is still reshaping itself in a way that we’re struggling to define and label. We passed through a time of phenomenal growth in, and exuberance about, technology, and then weathered a brutal storm. Technology went from being the answer to every question to a question itself: Does IT matter?

It’s a silly question, really. No one who examines the productivity growth figures for the U.S. economy can entertain it with any seriousness. But it’s indicative of the fact that the view of technology has morphed and the future will be different. Do we want to be on the cutting edge or do we want technology to be plumbing? What will the new technology industry look like? Where will we see innovation and how much will buyers be willing to absorb? Who will be the winners and losers? What will we call the next – the current and evolving – age in our industry?

My resolution for 2004 is to try to map these changes and help you make sense of them. I plan to stick with this resolution, though I’ve said that about losing weight and look at me now. But I have the collective assistance of the smartest people in the industry to help me with this resolution – the readers of VORTEX

Digest. How can I fail?

Thanks for reading for another year. Here’s to a prosperous, healthy ’04!

Bye for now.