TOM ENGIBOUS

The Internet is a powerful economic engine and a force for human liberty. Information is power.

Information Technology—especially the Internet—is shaping our future. We've seen amazing things. Still, we haven't seen anything yet. But delivering the Internet's full promise to every person on the planet will take hard work. Government and industry worldwide must work together on policies that encourage the Internet's progress.

We at Texas Instruments have a unique perspective on the future. We have nearly 50 percent of the world market for digital signal processors (DSPs), and we're the number one provider of analog chips. Both chips are the basic semiconductor technologies of the Internet Age. They are driving new generations of portable devices that will put the Internet in your pocket.

Three Emerging Truths

As we develop new technologies, we see three truths emerging:

1.Broadband communications are exploding. Both the capacity for high-speed communications and availability of broadband are booming. Globally, at least 52 undersea communications cables are operating or under construction—in addition to an expanding global network of satellite communications.

Nationally, companies in many countries are building new networks. In the United States, Level 3, Quest and GTE are all building coast-to-coast fiber networks to compete with the existing networks of AT&T, MCI, and Sprint.

Total aggregate bandwidth of all U.S. wireline networks was 1 trillion bits per second at the end of 1996, but it will rise to 100 terabits by 2003.

Locally, phone companies are busy extending high-speed services. SBC will invest roughly $6 billion to make broadband Digital Subscriber Line (DSL) available to 80 percent of their customers. One study predicts that 70 percent of all U.S. homes will have DSL access by 2004. Cable TV companies are an alternate route. That's why AT&T invested over $100 billion to buy major U.S. cable operators. Now, they're investing billions more to upgrade these facilities to handle voice and data. In addition, there's a huge increase in wireless networks capacity driven by customer demand.

Worldwide, 375 million people have Internet access today, growing to 500 million over the next two years. Most of these people still use dial-up connection, but as broadband becomes available, people are signing up. DSL subscribers in the U.S. will jump from 300,000 at the end of 1998 to more than 10 million by 2004.An additional 10 million homes will have high-speed cable modems by the year 2002.

2. Broadband subscribers are using bandwidth in increasingly personal ways. A primary reason people go online is to communicate with friends, family and business associates. The number of e-mail boxes worldwide increased 80 percent last year, to nearly 570 million. Beyond e-mail, people also want to connect to information. The fastest growing segments of online users are baby boomers and senior citizens who are drawn by Web sites about health, lifestyle, and business.

3. The Internet is changing everything; and yet the more things change, the more they stay the same. We use the Internet to do things differently, but our basic desires are still the same as always. People want health, wealth, and happiness. Internet working is a lasting phenomenon because it helps with these desires. On the horizon, we see wide use of smart medical devices, such as insulin pumps and pacemakers that are remotely monitored and activated by medical offices.

The same DSPs that enable high-speed Internet connections are being modified to process sound and light to allow deaf people to hear and blind people to see.

The world economy already has reaped tremendous benefits from information technology. In the U.S., GDP has grown an average 4 percent for several years—even as inflation rates have declined. We have managed to “sustain the unsustainable” through the power of internetworking and information technology. One supporting factor is e-commerce. In 1999, total e-commerce was valued at $151 billion. By the year 2003, it should reach $2 trillion. The efficiencies of e-commerce are changing the economy's cost structure by expanding customer bases and driving down the cost of delivering goods and services.

As the world moves to Internet time, lives can become hectic. In response, people are using the Internet to stay in touch with loved ones, and for entertainment. This will increase as new generations of Internet appliances come to market—devices such as smart wireless phones, screen phones, Internet game consoles, and web and e-mail terminals. People spent $2.4 billion on non-PC information appliances last year. That should grow to $18 billion by 2004.

The Internet is also reshaping other entertainment sectors. Take publishing. The declining size of high-speed modems means that people will be able to download music, books, and movies using very convenient, portable devices.

What all of this means is that power is shifting away from content providers and governments to individuals.

Our goal should be to ensure that all people benefit from the Internet's capabilities. I believe the Internet age will move the world forward in a positive direction. If the past truly is prologue, then our future can be amazing. EE

Tom Engibous is chairman, CEO, and president of Texas Instruments. This article is adapted from his speech to the Economic Strategy Institute's 2000 Global Forum, and is used with permission of Vital Speeches of the Day.