At this point let me invite Armando Garcia to come up and talk and even better show some real stuff. Armando is Vice President for Internet Media at IBM. Let me turn the stage over to Dr Garcia.

Good afternoon, let me spend a few minutes to talk to you about some exciting technology to help to enhance your presence on the web. I am sure all of you have some form of presence on the web, started with something simple, put up a web site, provide information about your company, move to the ability for people to order products, check the fulfilment, a progress on their order, when is it going to be delivered, etc. Perhaps you have moved to the point of self service on the web. Many of you are probably asking what next? Now that I have my web site what can I do to enhance it? Why haven't more people bought from me? Why haven't my sales increased? Maybe for some of you it has but how can you accelerate it?

I will submit to you there are many things that you can do but one of the ones I am going to talk about is make your web site much more compelling and useful for people to find all forms of information and find it in the most natural way. So I am going to talk to you about some technology that Stu alluded to and that's Rich Media Technologies.

Let's talk about media enabling e business. We are talking about rich media - we mean all forms of media can be used to enhance how you communicate about your company and your products and how you provide customer service on the web. For one simple reason, to make it more compelling, to make it more interesting and useful for people to come to your web site and find information so create a compelling web site, provide a more effective way of describing your product and as much detail as the customer is willing to drill down to and investigate about the product and accurately depict it. With a toothpaste you probably don't need much of a description but if it's a complex part and how does it fit together and how does it work, then the web provides a tremendous mechanism for conveying a lot more information than you can through printed material for example. And of course to improve customer service because on the web as many of you will have realised price is not the differentiating factor. People at the click of a mouse can go find the lowest price, so why are they going to shop with you versus someone else? Clearly brand recognition and service. It's going to come down to those two. So if you can provide a more interesting site people will come back and spend more time at your site and of course hopefully buy more things.

If you are making this investment what can you expect to get in return? Again, increased site traffic, people stay longer and more importantly, and I think this is one area where over time you will see a bigger impact, is increase in sales.

Let me give you a demonstration of the kinds of things that I am talking about and then I shall talk about some of the technology. All of you are familiar with sites you can go to to search for things. I am going to my favourite search site Yahoo and today I am interested in buying a table saw. Now you go to a web site and you get served up a lot of references where you can potentially buy a table saw. In addition more and more you are seeing advertisements that are being targeted to you based on a variety of information that we're able to gather about you or your interests. Here clearly I said I wanted a table saw so I have been served an advertisement about a company that sells tools. In this case HM tools. I happen to know these people, I have bought other things from them and it says here Click here to find more information. So I have been attracted to the storefront if you will, inside which I'm able to explore a little more about what they are offering and they're offering a new table saw and some new blades. I don't know if you can hear, but one of the things you can add of course is sound effects. So we can learn a lot more about various products that are being offered. I haven't left the web page I am interacting inside this banner and I can explore various products that this company is offering. Well I really wanted a table saw so let me find more about the table saw. I can interact with it as I draw the mouse left and right. So I am convinced, I have reached their storefront and I'm going into the store and see what they have. Now I am being pulled into the virtual electronic store. Again it looks like a typical electronic store that has text information about the product and maybe some images, but here again rich media can really enhance how you depict your product in a way that is compelling, it's interactive, it's interesting - I can rotate the product, I can inspect it, I can zoom in, I can look at different angles, different features of the product and I can provide as much level of detail, so you notice over here as I move my mouse over a certain part of it, there is a hot link and I can click and get additional information and you as the creator of this can provide as much information as you think will be compelling and interesting for your customers to visualise your product. Enough information that they'll say I'm convinced, this is the one I want. I already checked the price, I know this is the best price so let's go ahead and add that to my shopping cart. So now I am gone from being attracted to going into the store, to putting ascertaining that they have some advantages but clearly at the end of the day what value I am getting while I am inspecting different products and decide, well go ahead and get this 24 tooth car body, I know what that's all about, so let me go ahead and add that to my shopping card. And again, here we are, we've added something else to our shopping card. Now, I am going to need something, somewhere to mount this table saw so lets see what else they have to offer - they have bench and all of you, I am sure have purchased items from time to time, where you have to assemble it. If you are like me, usually when you assemble something, you end up with a few spare parts, except they were not spare parts, they were meant to be put on the item itself. However, here again, Rich media could help you provide a lot more information, self service information for your clients, so they can understand how to put it together and how it operates.

Again, this looks like a typical page that probably came out of your printing material. However, on the web you can now animate and provide a lot more information on demand to the end-user, with detailed information that you can see exactly how the bolt goes together, where the washer goes and the nut etc. And again, it's limitless to what you are able to provide and to do it in a way that it is compelling, interactive and very useful for your customers. You can go as far as to provide on-line help information and actually how to put it together, in addition to the fridge as we showed, and showing somebody exactly the order of which they need to put this together, for instance, control and inspect or whatever, to provide audio, (believe me there is audio here). Maybe while you are having coffee, I can show you. So again, rich media means all forms of Rich media that allows you to provide very valuable information. So again, from advertisement to commerce and now importantly, I believe in customer service, the web really opens up a whole new dimension for providing on-line information in a rich and compelling way. So let me just go back and say a little bit about the technology. This technology I have been showing you, a lot of you are familiar with Rich media Technologies but you have also had the pleasure, that when you go to web site that had Rich media, there might say that before you can experience this Rich media, you must go somewhere else and down load, a plug in if you will, to configure your browser so you can experience this Rich media.

Well, after a while, after installing 6 or 7 different plug ins, you sort of get tired of this, if you haven't already broken your browser, and you say, this is not worth it, as an end consumer, why am I being asked to integrate all this technology? But now that you have the technology, it means that I can deliver all that function to you as an end user transparently. So everything that I was showing you, I would simply go to web site and I would interact with the content, not with the technology. And so, using Java we are able to deploy all this, without any need for a special plug in, so you and the user deal with content. As a site creator, there is no special server and some cases for Rich media, I need to hold on a specialised server to serve up the Rich media. Again, here in this case, we don't need to do that. And if was very efficient, in spite of the fact of what Stew has been telling you, in the future we are going to have a hell of a lot more bandwidth with, but today we are stuck with what we have. And so we have taken a very pragmatic approach to use the available band with, and that means a 28.8 or 14.4 or 57.6 connection to deliver this, so I am not going to be able to stream real time full resolution video today, but in the future I will, and this will allow you the scale, and it provides a much richer user experience.

Its available today in fact, a very easy place to find it. You have IBM.Com, wwwBM.Com/Hotmedia, a pretty simple place, and you can actually download the pool. And we have a number of customers who are applying this as that showing you for advertisement, for electronic catalogues, for self service but a lot of other applications as you can possibly imagine, virtual tour, if you are a hotel provider. Why not provide on line ability for people to take a virtual tour of your facility. Many of our customers have done that. I am sure some of you have even used some of those services. If you want to check exactly what aeroplane sit I am going to sit in. You can do that virtually. And more and more in distance learning, in e-learning or computer based training, I am sure many of you are using that. Again this is where the power Rich media really comes in and provides a tremendous advantage.

More and more you are going to start seeing applications in which you will have collaborative meetings in which you could share the wipe board, you can have video conferencing, synchronised and access to a lot of information traveltaneously that you can share amongst colleagues and distant locations.

And again, we have taken a very pragmatic approach. We are using the infrastructures that exist today, the Internet as we know it. But, don't forget, there are a lot of activity going out around the world, involving what we consider is the Internet. In the United States we call it Internet 2, in which there are 130 different Universities and companies, like our own that are participating, in not only driving a tremendous leapfrog and an amount of bandwidth that is available, 100 times or 1000 times more dealt with, that's interesting but, bandwidth is like storage, you will fill it up as quickly as you have it. More importantly, its one of the new applications and all those applications are going to be rich in media. Like I showed you but, now take it to the next level - full motion video, inter graded audio telephony and data services is all part of the user experience. And of course, be able to feel that, to meet the demands of your business. So with that, let me turn it back over to Stew.

We will switch back to the other set of slides and I will talk just a few more minutes and then we will take a fresh look. So, back to business relations. How can you use the technologies that actually speed up the way you deal with your partners, with your suppliers, how do you set up these connections?

The positive technology really makes this much easier, much more affordable. Security is here, giving you visual certificates, secure information in interchanged technology, so you can deal with people you haven't dealt with normally and still it with reasonable security confidentiality. Techniques that at one time required, you would meet somewhere in an airport and swapped keys with each other physically, you can just do it electronically. You can decide you want to deal with somebody, get a certificate that says they really are who you think they are and then go ahead. You can share a database, you can share direct access, Luke Winch, I believe will talk about this, a little bit tomorrow on the fly chain. Making access to certain parts of Europe and detailed data available. Mr Hung earlier referred to making information available to certain of the Travel Agents, about what their status is. Basically that is a deep look into your data base and something very private only for them. The technology now makes this possible. If you have problems with communication, you don't have to have a long term relationship, in order to have an intimate one. You can do whichever business style that makes sense, the technology will support rapid, fast, short term, long term connections as is appropriate. Or you can have negotiating decisions, such as auctions or competitive bidding or you can go to long term contract. The important feature here is the technologies of moving into place, so that you as a business person can simply choose which of these options. It isn't that there is one side fit all, any size is available. And the technology is making it much more reasonable, much more believable to manage huge amounts of information, that has complication business trusts that is running with multiple partners, multiple customers, all the time. It is possible to get the processing power and the memory to do this reasonably. So, the amount of storage that companies have and manage has risen phenomenally over the last few years. Underlying technology fast is that disk density, the amounts of information you can store per dollar or per square centimetre. It's simply falling even faster than the cost of computer memory or computer chips. So you really can afford lots more memory on your disks and utilise the information.

It is now perfectly common for a company to have 10 terra bits of usable information on line. That 10 to the 13 bits for people who want to talk about those numerically. It is not at all unknown for companies to have 100 terra bits. Many companies actually have 100 terra bits of useful information, in their enterprises that they are managing and accessing. There are a few sides that are actually pushing for a peda bit, 1000 terra bits, hinders the 15 bits. These are not phenomenal numbers, their existing companies that are doing this today. So, the amount of information is not the bar anymore, it's what are you going to do with it? Why bother storing all this stuff, just because you can? Well, whether in crucial business intelligence from analysis, turns out to be profitable. Really looking at the patterns, really looking at the linkages is starting to become technologically possible and with real business consequence. Access the storage in the computing place is a form so far, is a reasonable thing to do. For example, reaching further, reaching more customers, reaching the right customers more precisely. We all get bombarded with junk, sufficiently often that we tend to ignore many offers and when you get something that actually on the first line, ringed and says, I want this, that is a possible sale that come up out of the noise. Allowing the company itself to make better decisions that are forecast, again particular comments on the rising efficiency of running the airline, 9% more customer trips, 5% more of the equipment, 4% saving which is tremendous more a real business. So, the advantage of new sources of information, cross-linking, purchase records, graphing information and details of what the customers behaviour is. Actually analysing what is called the click stream, watching what people do as they move on your site and on and off of this. The various clicks, the various moves around. Its awful if they loose a great deal from this as the pattern analysis is very expensive. Of course, there are many issues of privacy, many issues of confidentiality that come into here. The information has been managed appropriate, but there are tremendous opportunities for people understanding of your customers and of your vendors. Being able to search the web, being able to a test search of the entire web is, for most people rather a surprising concept. Those of us who are use to looking up something in a dictionary or an encyclopaedia as a child, in the thought that you could now look up something in the entire world's visual library with the same effort as taking an encyclopaedia down off the shelf. It's simply a change in your mind sense. We can do this test today quite reasonably. Yes, we all know the phenomenon that you go to a web search firm and give it a key word and back comes two million answers, among them are table saws, came back as things relating to woodworking rather than some table that somebody saw, but we all know how that works. But the thing is that you and the tool work together, you can do searches and better. However we can start to do this from voice, images and video now. The next generation of capabilities is just coming on line so, it needn't just be searching the text, you can search the information on the pictures about what the spoken word was. Not as good as text but technology is moving forward even here and one reason for needing to store all that information is, it takes a lot of bit to store a video or speech. Data mining techniques, there are de-nargarthyms, really sophisticated mathematics, getting better for finding patterns in mixed data, understanding what is used and inducing some consequences. Really these computing are an obligation to do it, you can't do it simply. The good news is computers are getting enormously faster at very low cost. It is possible to afford many of these analyses that people could not do before. The technology is moving together in sink, in order to make it very reasonably as a business person to be looking around the world, looking at data sources, widely separated, combining them, understanding them for real purposes.

So, let me just stop today on sort of a summary. The hardware story is basically bandwidth from your PC's going up from 56 or 28 kilo bits of the mega bits per second, the band width on the back bone typically, numbers like 155 mega bits for the best connection of the day, a research network for internet open two weeks ago and the back bone is 225 giga bits that's 16 times faster than that and as I mentioned earlier, we are moving towards terra bits per second in a few years. The question is, the cost will be reasonable, what will the price be?. Is there continental band width? should be around 45 mega bits at the moment, that's moving up towards 155 and soon 2.5 giga bits for the new set of fibre going in. New technology will permit a retrofit to go up nearly 100 giga bits on the same under water fibres. So, even between the continents, we are going to see lots of communication capacity available so, as you are thinking about, what are the drivers from global business network, will be your friends not your foe. Other numbers, if you are storing information, 10 giga bits cashes on the web are quite common, terra bits are now available and reasonable. If you want to store something you pulled off the web, you can do a lot of it for a very small amount of money it turns out. Enterprise Databases, I mentioned the -10 terra bits, 100-1000, super computing, if you want to know what the high end of computing is. A year or two ago a billion instructions per second was a lot. Today the fastest super computer installations in the world are running at 3 trillion instructions a second and are the position for certain military installations. In a couple of years, 3 or 4 years we will be moving towards 100 trillion instructions per second. That's the very high end, but there will be civilian machines at these other rates in the next year or two. Computing capacity is available and is affordable.

Software - I am not even going to go through this list. I have mentioned most of these issues as one of the software, is available to help solve their technology like intelligent agents for doing shopping and filtering, doing on line auctions as part of a regular business, not an exotic possibility but if there is something you do as a normal activity. Authentication, identification, smart cards, visual certificates, iris prints, fingerprints, process inauguration and so forth. These capabilities are real. You can buy the beginnings of any one of these today, pre packaged, stuff that works. It's going to get a lot better over the next few years. So the capabilities are there to really use the modern technologies to do business around the world, dealing with the customer, dealing with the vendor much better.

So, basically in this section, sort of gone over at a very rapid clip. A number of the fundamental technologies that are coming on line, that are here starting to appear, you can predict, look easily at what the changes are like on a network side, on the software side, on the ability to communicate with people but with speech, with other means that they enjoy and the language that they enjoy. The realistic and the fancy version of media, so that you don't have to do things in my style which is all words, you can get pictures, moving objects such as Armando showed us, faster than any relations among businesses because some of the requirements of security, of impromptu connections, of data sharing are all unmanageable. The ability to choose an art of computing, you look at enormous amounts of data for business purposes. The bottom line expectation is that you can use all this techniques, they are coming, they exist in one form or another now, they will be growing over the next few years, more customers, deal with more suppliers, more partners and ideally, with more revenue. So, let me stop here and ask Armando to come up and take a few questions before we take a break. If anybody wants to ask anything before break.

One final questions perhaps. If not, then let me declare a 3 minute break of basically out this door and through the connection into the main hotel, into the plotted off area, next to the brassiere. Thank you very much.

Very well known and recognised Economist. Co-author of a recent wonderful best seller entitled "Information Rules". This is a book that I highly recommend to everybody in the audience. It has been basically a business best seller. He was just listed as the owner of one of the fourth best most important website economics by the Economist Magazine. This book, if you don't care to read it in English, will soon be available in translation in French, German, Spanish, Portuguese, Korean and Japanese and probably other tongues. So, at this point let me turn it over to Mr Varian, who will basically be telling us the long term, deep economic drive behind the information society.