Many small, and some large, operators who had been wholely dependent on venture capital disappeared or were acquired. The results were even more layoffs, liquidations and retrenchments.

It's a bit hard to tell what's going to happen in 2002 -- but so far we've had the usual list of Microsoft security holes and a propensity for dominant or monopoly players to take advantage of their position so as to reduce levels of service or raise prices despite complaints from customers.

Each year I do my best to anticipate the trends and events of the next 12 months so here I go for this year.

Music Versus The Pirates
The recording industry will continue to roll out copy-protected CDs, despite the futility of such actions. They will pretend to be surprised when, contrary to expectations, sales of CDs continue to fall as people simply download popular albums and tracks from the Net to avoid the hassles of disks that are incompatible with their DVDs and computers.

Online subscription-based music services will bomb -- attracting nowhere near the levels of interest necessary to make them a profitable enterprise.

Look for a concerted push from the recording industry to have a tax imposed on recordable media such as CDRs and CDRWs. Their pitch will be that this tax will help offset losses due to pirating. Don't be surprised when many governments succumb to such lobbying. Remember that here in NZ we're already assumed to be pirates unless we can prove otherwise -- this is simply a natural progression of that law.

It's going to take at least another year before the recording industry wakes up to the fact that the horse has bolted and that their existing business model has passed its "best by" date.

Readers Say (updated hourly) From Friday Record Companies... - james Online Music Honesty Box... - Brent Paying Artists directly... - Simon Have Your Say

The ISP Business
The big players will continue to dominate and strengthen their positions.

With broadband becoming increasingly important, the small players will find it difficult to compete with those companies who "own" the infrastructure.

Telecom won't let go of the reigns anytime soon and Telstra/Clear won't have enough copper/fibre in the ground to produce any real competition.

Small niche providers will survive -- but they'll have to be very lean and mean to do so -- or offer the superior levels of support and service that some market sectors demand and are willing to pay a premium for.

Web Design/Hosting
The initial surge of companies realising that they ought to have a website has been and gone -- leaving many web design companies looking for work.

This situation will not improve in 2002 and some web designers only have themselves to blame. The massive demand of 1999/2000 meant that many incompetents actually managed to convince an eager market that they had the necessary skills and abilities to build them a website. Unfortunately the shonky sites these cowboys built have given many businesses the impression that websites simply aren't worth the expense.

Many of these businesses could benefit greatly from hiring a skilled designer to properly rebuild their site but trying to convince them to invest more money in this sector is now virtually impossible -- their impressions of the Net have already been soured.

Digital Television
Nothing but bad news here I'm afraid.

Sky's new "Interactive" system remains a nightmare -- despite the repeated promises of improvement. Given their monopoly position they have no need to actually react to customer complaints -- so (as has been witnessed over the past month) -- they won't.

With the capital cost of launching a digital TV service being so high, don't expect this situation to change anytime soon.

One solution to this problem might be to cancel your Sky subscription and try reading books, surfing the Net, or even getting a real hobby that involves making things or interacting with (gasp) other people!

Technology
The pace of technological innovation seems to have slowed a bit lately. Sure, things are getting smaller and faster -- but there's not much which is totally new and many of the promised technologies of last year or earlier have yet to materialise at a commercial level.

Amongst the things I'd like to see (but won't) are an affordable digital VCR (hell they have digital camcorders so why not a home VCR using the same technology?) or DVD recorder. Something like the Tivo system being sold in the USA would be great. Record up to 20 hours or so of content onto an internal hard drive and then burn copies of programs you want to keep onto DVD or VCD.

Of course the movie/recording industry would effectively put the kybosh on this -- after all, they won't want people pirating movies like they're doing to music right now will they?

Online Security
Look out for more holes in Microsoft's software (no shock value there). However, despite an even greater number of worms, viruses and trojans doing the rounds this year, the vast majority of people will simply stick with Windows, Explorer and Outlook as their software.

Security-conscious companies ought to give consideration to removing all copies of MS Explorer and Outlook from their systems and replacing them with something such as Opera -- but few will -- just as few have switched from Windows to Linux.

Actually -- there's a huge opportunity for some enterprising startup to get into tbe business of "military strength" browser and email clients designed from the ground-up for security. I'm sure the corporate market, already suffering irritating losses and risks through the use of Microsoft's applications, would love a compatible product that came with higher guarantees of security.

Not All Bad News
So that's it -- not a particularly pretty picture I'm afraid.

However, on the bright side, there will be a handful of blazing successes and good news stories. Innovation, enthusiasm and ability is still in good supply so you can be sure that there will be some pleasant surprises during the next 12 months.

And -- if you hear of any "good news" stories, please let me know, I'd love to pass on the details.

Have your say (remember to select For Publication if you want to see your comments on this page).

Are You Secure?
As mentioned above, already this year there are already a couple of important security issues which affect Microsoft Windows users.

Please read this story from The Register and make sure that if you're using XP, you've gotten hold of the latest round of security updates.

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