Long-awaited digital convergence is finally happening, says Gottfried Dutin, executive VP with Royal Philips Electronics: “Digitalization is creating products that can’t be categorized as tech or consumer electronics. The walls are coming down.” With cell phones that double as PDAs, iPods that play movies, and Wi-Fi boomboxes you can listen to by the pool, the lines between three major industries—computer/software, consumer electronics and communications—are blurring. “The result is a Big Bang of convergence, and it’s likely to produce the biggest explosion of innovation since the dawn of the Internet,” predicts Business Week.
Fueling the trend are the rapid evolution of technology, increased penetration of broadband Internet access, and the tech industry’s insatiable hunger for growth. The result will be a digital river of content featuring hundreds of thousands of “bloggers, fly fisherman, chefs and Oprah wannabes — uploading gobs of video programming — creating their own channels,” all of which will play on any number of devices, from cell phones to videogame consoles. “The concept of a network or channel will go away,” predicts Jakob Nielsen, a partner in the Nielsen Norman Group.

“They’re artifacts of old technology.” And while the new hybrid machines will generate plenty of buzz, the “congealed services” wrapped around them will create a far greater impact, says Paul Saffo, director of the Institute for the Future. Rather than buying a device, consumers likely will rent or borrow their preferred hardware and use it to subscribe to just about everything—music, movies, software, burglary protection.

“We’re within 24 months of a subsidized TV,” predicts former Microsoft exec Juha Christensen.

Business Week 21 Jun 2004