1999 Carl Reed Editorial: A Reality Check

The geospatial industry, including GIS, is in the midst of major change. This column is
the first in a series discussing the forces shaping change in the geospatial industry and
what it means for the future of the industry. The goal of the series is to be both
informative as well as thought provoking. Even if one disagrees with my premises or
conclusions, my goal for writing these columns has been achieved.

Before starting, however, there is a short quiz. What technology had it humble
beginnings 30 years ago?

a. Color TV
b. The Internet
c. Interactive (as opposed to batch) computing
d. Cellular telephones
e. Computer based GIS

If you answered “b”, you are correct. The Internet had its beginnings as ARPANET in
1969. Funded by the Advanced Research Project Agency of the DoD, it actually crashed
during its first live test in October of that year. The goal of ARPANET was to develop a
nationwide ring of computers and communications designed to keep functioning even if a
nuclear attack took out part of the network. The ARPANET Project actually began in
1958 but it was many years before a user on one computer could log into another
computer.

Now for the next question. In what year did the first widely available web browser make
its debut?

a. 1987
b. 1990
c. 1993
d. 1995

In 1993, the National Center for Super Computer Operations released Mosaic. Mosaic
was pretty much available as freeware. Netscape followed as a commercial successor to
Mosaic in 1994 and Microsoft released Explorer in 1995.

The reason for these questions is simple. We need a reality check. We need to step back
and consider the changes have occurred and the changes that will occur. I think we all
forget how young the Internet really is. And yet the changes the Internet has already
created in information technology, software, services, and even to some extent, society,
are phenomenal. Four years ago, there was no amazon.com, six years ago Java was just
an idea, HTML appeared in the 1990/1991 time frame. In 1993, there were just 130 web
servers. Today, there are over 2.5 million.1 In 1993, there was basically zero dollars in e-
business. In 1999, e-business revenues will exceed 100 billion dollars. This figure does
1
Michael Peterson, “Trends in Internet Map Use”, Proceedings of the ICA, 1999.
not even include retail revenues! Total e-business, including retail, is projected to exceed
1.3 trillion by 2003 – and could be significantly higher if key legislation passes and a
number of antiquated laws are removed.

The use and acceptance of the Internet has spread more quickly than any other
technology in history. Its impact will be on par with those caused by the telephone, the
internal combustion engine, and mass communication (radio, television, and movies).
And yet, other than headline news, most of us remain largely unaware of the changes the
Internet is bringing about in our financial, retail, communications, and other industries.
Business processes are being re-modeled, whole new market models and sectors are
appearing. Many existing businesses, or parts of businesses, will disappear. Why is this
happening? One indicator: A recent study2 by the Giga Information Group suggests that
the cost savings globally through the use of e-commerce will rise from $17 billion in
1998 to 1.25 trillion in 2002. A very simple example of these savings is in the financial
industry. It costs only a penny to process a Net based transaction, compared with $1.07
for a branch and 27 cents for an ATM.

The same can be said of the geospatial industry. As Sherlock Holmes liked to say, “The
game is afoot”. The Internet game will radically change the way we access, utilize, and
pay for geospatial technology and services. The Internet is creating Geoffrey Moore’s
tornado3 in many industries. The “tornado” is the name Moore gives to the phase in
which market dynamics create hypergrowth in an industry and a (potential) new gorilla
emerges to become the market leader. The geospatial industry may be entering this
phase. New geospatial software and service companies are emerging that better fit the
requirements of the Internet economy. Other companies and organizations are changing
their business and services practices to best meet rapidly changing buyer and user
demand. Companies that do not change their business model to meet the demands of the
new Internet based economy face hard times and potential extinction.

Consider this. What GIS based Internet technology is the most heavily accessed in the
world today? I would argue that it is the Mapquest site. According to a recent
presentation by Mapquest4, their site is currently generating an average of over 4,000,000
maps per day, or just under 2,800 per minute. Some may take exception to the statement
that this is GIS technology or that some other vendors’ software at multiple sites is
generating more maps. These can be argued, but in arguing the real point is being
missed. There is a new market economy, a new definition of value add, appearing in the
geospatial technologies business. It will redefine the geospatial industry and finally
allow it to realize its true potential.

There is a rapidly emerging trend in the Internet world – the ASP, or application service
provider. ASP’s allow the user to subscribe with a provider to obtain on-line access to the
desired software. The availability and use of ASP’s in the geospatial industries is quietly
but steadily growing. The next column explores the potential short and medium range
2
Business Week, Oct. 4, 1999, page 71.
3
Geoffrey Moore, Inside the Tornado : Marketing Strategies from Silicon Valley's Cutting Edge, 1999.
4
Presentation by Mapquest at the WebGIS Conference, Penn State, October 1999.
impacts that ASP’s will have on the geospatial industry. Several examples will be
described with thoughts provided on where the new geospatial ASP’s will appear. Other
columns will explore a variety of topics, including societal impacts and technology
considerations and trends, all from the perspective that our industry is changing and that
geospatial data and technology usage, while perhaps hidden, will become ubiquitous.