Edupage, 21 June 1999
EDUCAUSE
Edupage is a service of EDUCAUSE, an international nonprofit
association dedicated to transforming education through
information technologies.
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TOP STORIES for June 21, 1999
Panel to Weigh Internet Tax Options
Economic Impact of Computers
Survey Finds PC Usage in Homes Has Dropped
E-commerce 'Not Hitting Revenue'
ALSO
More Projects, Less Time
On the Web, as Elsewhere, Popularity Is Self-Reinforcing
Slow Road to Win 2K Benefits
A New Breed of Thinking Computer?
PANEL TO WEIGH INTERNET TAX OPTIONS
A 19-member Congressionally-appointed commission begins work on
Monday in Williamsburg, Va., to seek consensus on tax issues
relating to electronic commerce. The panel consists of both
political and industry officials with a wide variance in
positions on the issue. Brick-and-mortar retailers say a
tax-free Internet encourages people to shop in cyberspace, and
local and state politicians are worried about the loss of tax
revenue as more and more shoppers buy their goods online and
avoid paying sales taxes. Meanwhile, many Internet industry
players say that imposing some kind of Internet tax will undercut
the momentum that electronic commerce has built up as well as the
U.S. economy as a whole. Still others say that if the U.S.
imposes a tax and other countries do not, Americans will turn to
overseas merchants and cost U.S. jobs and revenue.
(Associated Press 06/20/99)
ECONOMIC IMPACT OF COMPUTERS
The economic impact of computers has proven difficult to measure,
but some economists are now beginning to find strong evidence of
the crucial role information technology is playing in the
economy's health. At a hearing last week on high-technology's
importance to the economy by Congress' Joint Economic Committee,
those testifying agreed that IT's role was crucial and growing.
The Commerce Department says business investment in computer
technology has grown from 7.7 percent of the total investment in
durable equipment in 1990 to 45.7 percent in 1998. And a
Brookings Institute analyst and others say they are now seeing a
big increase in output growth as a result of computers, which may
explain the big jump in productivity growth from 0.33 percent
from 1993 to 1995 to 2.2 percent from 1996 to 1998.
(Washington Times 06/21/99)
SURVEY FINDS PC USAGE IN HOMES HAS DROPPED
Although PC ownership has increased significantly, usage of home
computers has dropped, reports a survey by Arbitron NewMedia.
The survey found that PC ownership has grown from 29 percent in
1995 to 54 percent in 1999, yet the percentage of people that say
they regularly use their machine has fallen from 90 percent to 53
percent in the same time period. Similarly, the number of PC
owners with subscriptions to ISPs has risen four-fold from 1995
to 1999, while only two-thirds of these subscribers actually use
the Internet. One factor in these findings is the survey's
exclusion of children under the age of 16, who are often the most
active users. Another factor is a change in buyers' motives:
previously, consumers bought PCs because they were interested in
experimenting with the emerging technology, while now, consumers
buy computers because the prices are low and they are easy to
obtain. (Wall Street Journal 06/21/99)
E-COMMERCE 'NOT HITTING REVENUE'
Electronic commerce does not present a significant threat to tax
collection by state and local governments, according to a study
by Ernst & Young. The study was conducted to calm fears that
e-commerce transactions, which are tax-free, are robbing state
and local governments of money from sales taxes. The report
found that taxes not collected in 1998 amounted to $170 million,
only 0.1 percent of total state and local government sales and
indirect tax revenues. The impact is low mainly because 80
percent of e-commerce transactions are business-to-business,
which would not have been taxed anyway. Furthermore, 63 percent
of online household sales involved items that could not be taxed,
such as financial and travel services, as well as groceries.
Among products that could be taxed, 60 percent substituted orders
from mail-order or telemarketing companies that do not generate
taxes either. Internet purchasing was declared tax-exempt last
October in a bill that also placed a three-year moratorium on any
new taxation. (Financial Times 06/21/99)
=======================================
MORE PROJECTS, LESS TIME
IT executives are finding they have to reset their priorities
much more frequently than in the past, as the pace of change in
business continues to increase exponentially. According to a
recent InformationWeek poll, 75 percent of IT executives are
resetting their priorities more frequently, with some changing
priorities as often as once a month. Among the reasons for the
urgency, they say, are the Internet, deregulation, globalization,
ever-changing technologies, and more technologically
sophisticated customers, suppliers, and partners. Further,
IT has evolved to take on a more central role in business, and is
no longer simply an enabling unit. Indeed, in their list of IT
priorities, respondents said the top three were understanding and
meeting customer needs, improving customer service, and
streamlining business processes -- more business-related goals
than traditional technology objectives. (InformationWeek 06/14/99)
ON THE WEB, AS ELSEWHERE, POPULARITY IS SELF-REINFORCING
A study conducted by researchers from Xerox found that 5 percent
of all Web sites received 74.81 percent of all Web traffic. This
finding seems to refute the claims of some Web developers and
entrepreneurs that argue that the Web is a great equalizing
business opportunity. The study also found that the most popular
sites are those that were created first and have had the most
time to gain word-of-mouth recommendations from friends and
acquaintances. The Xerox findings echo those of IBM researchers.
IBM researchers, which graphed Web site hyperlinks in an effort
to improve Web search technologies, found that large numbers of
hyperlinks to a particular Web site can be a good measure of the
site's popularity. (New York Times 06/21/99)
SLOW ROAD TO WIN 2K BENEFITS
IT managers say that big companies opting for long, phased
migration to Windows 2000 are unlikely to see many benefits for
up to 18 months after its implementation. Features such as
Kerberos security and Active Directory won't be available until
the OS is installed on every desktop and server, so those taking
the slow road to migration will have to wait awhile before seeing
a return on the costs of software, hardware, training, and
deployment. Still, analysts say the slow, steady pace is the
best strategy because the migration to Windows 2000 will be the
largest and most difficult companies have ever faced. "Plan long
and hard," advises Eric Hemmendinger of the Aberdeen Group.
"This is not going to be fun. This is going to be like an
earthquake for a lot of organizations." Even Microsoft is
advising that companies do the migration in stages, saying they
will see "incremental benefits" such as local encryption
capabilities. (Computerworld 06/14/99)
A NEW BREED OF THINKING COMPUTER?
A team of researchers at the Georgia Institute of Technology and
a handful of other groups are working to develop hybrid
biocomputers that marry living nerve cells with silicon circuits
to create smarter computers. If they succeed, they could set the
foundation for brain-like computer systems that could find
solutions on their own, with no need for step-by-step programming
instructions. So far, researchers have joined two neurons from
leeches and linked them to a personal computer, which sent
signals to each cell and correctly extracted the answer to a
simple addition problem. The program that links the neurons and
the PC, dubbed "wetware," is based on chaos theory, using the
results to tune the neurons and alter the way they communicate.
Ultimately, brain-like chips will be more creative and may mirror
both the good and bad aspects of human thinking. William L.
Ditto, who heads the project at the Georgia Institute of
Technology, says it will be 10 years or more until biocomputers
are commercially available. (Business Week 06/21/99)
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Edie Clark, Editor
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UPCOMING EDUCAUSE CONFERENCES AND MEETINGS:
Seminars on Academic Computing (SAC)
Strategy, Technology, Organization, Relationships, and Mission (STORM!)
August 6-11, 1999, Snowmass Village, Colorado
http://www.educause.edu/sac/sac99/sac99.html
CAUDIT-EDUCAUSE Institute
August 8-12, 1999, Port Stephens, NSW, Australia
http://www.caudit.edu.au/caudit/institute/index.html
EDUCAUSE '99
"Celebrating New Beginnings"
EDUCAUSE Annual Conference
October 26-29, 1999, Long Beach, California
http://www.educause.edu/conference/e99/
For additional information on these conferences see
http://www.educause.edu/conference/conf.html
For information on other technology related
educational conferences see
http://www.educause.edu/ir/events.html
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News abstracts Copyright 1999, Information Inc., Bethesda, MD
Edupage Copyright 1999, EDUCAUSE
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EDUCAUSE, an international nonprofit association dedicated to
transforming education through information technologies