The Year of Peer-to-Peer

The big trend in 2000 was the application of direct marketing discipline (and other true marketing disciplines) to the online world.

As a result, email lists became integrated with paper address lists, brick-and-click strategies trumped online stores, and the Internet became just another medium.

The big trend for 2001 is now apparent. This will be the year of peer-to-peer.

I know what you’re thinking — Napster. But that’s just the tip of the iceberg. Peer-to-peer really has a lot of great business uses. I predict that over the next several months, you will see several peer-to-peer start-ups get big chunks of venture capital. The result will be a feeding frenzy and new speculation. That’s OK, as we now know that’s how valuable industries get their start.

The rise of peer-to-peer is a natural outgrowth of Moore’s Law. Moore’s Law (and Nielsen’s Corollary) hold that the price of computing power (and network bandwidth) is cut in half every 18 months (or, you can get twice as much for the same price).

Moore’s Law is what killed the network computer (NC). Remember the NC? This was the cheap, less-than-$500 terminal that was supposed to replace the PC in Larry Ellison’s imagination a few years ago. Now $500 will buy you a more powerful computer than the one that was on Ellison’s own desk back then.

Thanks to Moore’s Law, my kids are using 733 MHz machines that cost $800 each, while I use a 466 MHz machine that’s a year older and costs a bit more. The kids’ boxes also have bigger hard drives than mine, and by this Christmas 1 GHz machines should be common under many Christmas trees.

Today’s server, in other words, is tomorrow’s client. Today’s client is tomorrow’s paperweight. Multimedia files, meanwhile, aren’t getting bigger; with improved compression they’re getting smaller.

The only difference between a client and a server today is the software it’s running. Servers run NT Server, which costs thousands of dollars and supports virtually unlimited simultaneous connections. Clients run Windows ME (soon they’ll run XP) and can access only four connections at once.

So this is how Linux could break the Windows monopoly. Linux doesn’t have those artificial, price-based boundaries between client and server. The power of tomorrow’s clients will let my kids run multiple operating systems simultaneously — Windows for desktop applications and Linux for communications.

Now ask yourself: What can you do with that power? How can you deliver marketing messages within that kind of network? What can you sell to people using that network, or through that network?

I’m not able to answer those questions right now. But they are the right questions to ask. A lot of people are asking them, and their answers will make some of them multimillionaires.

One of those fortunes could be yours.

The fun has just begun.

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