10 x 5
Which ten high-tech innovations will change the way you do business over the next five years? Here's what the experts think.
By Adam Lincoln

Dr James Canton, president of San Francisco-based think tank Institute for Global Futures, is practically leaping out of his chair. White House advisor on science and technology, and consultant to a wide range of multinationals, Canton is talking about the impact of cutting-edge technology on business. And, like any futurist worth his salt, he seems almost to be in competition with himself. Finally, his eyes light up as he leans forward and delivers this statement: "The CFO of the 21st century needs to understand technology better than the CIO of the 20th century."

A sobering thought, but one worth heeding. In the world according to Canton, four essential building blocks - bits, atoms, genes and neurons - are colliding to create the four "power tools" of the new millennium: computers, networks, biotechnology and nano-technology. Each development leads to another; innovation breeds innovation. His fellow soothsayers peddle variations on the theme, but they tend to meet on pretty common ground. "Technology is causing a rapid design of new products, business models and markets - with all eyes on the needs of the emerging customer," Canton says.

That call is getting louder - and it doesn't matter whether you sit in Boston, Bangkok or Brussels. Globally, the technology playing field is levelling out. Recently, Belgian speech recognition expert Lernout & Hauspie reported that South Korea contributed 53 percent of the company's sales in its first fiscal quarter. Last year, tiny Singapore outranked the US as the firm's biggest market. Such reliance on Asia for orders may not be widespread, but it illustrates a point. Emerging technology is no longer the preserve of Silicon Valley research labs or Nasdaq-listed tech firms.

How, then, might companies decide which technologies to adopt and which to ignore? Jumping onto a bandwagon too early can make for expensive errors; procrastination can result in lost opportunities. The good news is that common standards, and collaboration between vendors, play a bigger part than in the past. In this regard, it will be harder to misstep than back in the days when proprietary solutions ruled.

Even better, the degree of consultation between technology providers and their corporate customers is improving. IBM points to its first-of-a-kind projects with partners keen to secure first-mover advantage. For example, the US company's lab in Zurich has already developed an application that enables selected Swissair passengers to check in from web-enabled mobile phones.

Still, emerging technology comes with no guarantee. Bad guesses will prove costly and even right ones will be pricey. Expenditures for technology initiatives can be mighty steep - and industry watchers say IT budgets are likely to balloon in coming years. According to the London-based Computer Business Review, companies will have to spend 40 percent of their operating budgets on IT merely to keep up with competitors. To stay ahead of the pack, the figure rises to about 60 percent.

That kind of spending puts the CFO squarely in the hot seat. While some CEOs may have their heads turned by dazzling new products, few projects will get off the ground without the finance chief's approval. Innovation, it seems, still needs a little tire kicking. "Companies should not be overwhelmed by the hype of emerging technology," advises Les Hales, director of the Gartner Group in Hong Kong. "This is still 80 percent a business issue."

Which brings us right back to Canton's prediction about the 21st century CFO. If he's right, finance managers have some catching up to do. To help, we interviewed dozens of scientists, gurus and industry experts. The question we put to them was a simple one: What technologies will change the way companies do business over the next five years? We purposely limited the time frame to half a decade. We weren't looking for science fiction. We wanted real innovations that will have a real impact on real corporations - and soon.

The answers we got were fascinating. From holographic storage to human-computer interaction to digital ink, sweeping changes are headed this way. While our gurus disagreed on which high-tech innovations possess the most commercial potential, all agreed on one thing. The next five years will see widespread corporate adoption of technologies that not long ago seemed the stuff of fantasy.

Here then, are ten technologies the experts say every CFO should know about. We've listed the choices according to the estimated time of corporate arrival (ETA) - meaning widespread impact - for each innovation, from soonest to latest.

Smart Money
Cashless consumerism, smartcards
ETA: 2002

Financial institutions have been flogging smartcards for years. Using technology originally developed at Britain's NatWest Bank, member institutions of Mondex International, the MasterCard-led consortium, began launching Mondex cards with lots of hype in the mid-1990s. But the cards have yet to live up to expectations. Even Banksys, a banking network operator in Belgium, which has issued some 25 million smartcards, has had a tough time changing customers' minds about the value of electronic money. The difficulty, says Alan Laird, marketing manager for e-solutions at French electronics conglomerate Groupe Bull, is altering well-established habits. "When you describe it to consumers they think it is a great idea," Laird says, "but the problem is getting them to use it."

It seems, for most people, there's nothing like cash. That doesn't mean smartcards are dead and buried. Far from it. Currently, there are 1.1 billion smartcards in circulation. And the smartcard concept - putting processing power onto a plastic, all-in-one-card - remains intriguing. In Hong Kong, for eaxample, the three-year-old Octopus Smart Card is starting to take off, with some 6.4 million cards now in circulation, one for every person in the city. Initially designed for paying fares on public transportation, it can now be used in a growing number of fast food shops and vending machines.

Laird believes smartcards will eventually catch fire. Why? First, because smartcards speed up the process of on-line transactions. What's more, smartcards offer private key encryption. That verification of a user's identity, Laird says, makes smartcards infinitely more secure than credit cards. Some banks already use smartcards, in conjunction with biometrics, to ease customers' fears about banking on-line.

Indeed, some prognosticators believe the real promise of smartcards actually lies in user identification. In coming years, consumers will be able to use a smartcard to encrypt their mail and identify themselves to on-line businesses. Moreover, smartcards enable users to sign digital documents. That could have one very big impact on how companies distribute items like HR documents. Using company-issued or third-party smartcards, employees will be able to fill out and sign on-line expense reports, purchase requests and group insurance forms.

Ray of Light
Fiberless optical networks
ETA: 2002

The performance of today's high-speed computer networks is like quicksilver: erratic. The link between internal and external networks - the so-called 'last mile' - is notoriously a bottleneck. Copper wires have struggled to cope with the increasing traffic demands placed on them, and for many companies the alternative - laying optical fibers - has been prohibitively expensive. The upshot is that companies haven't been able to make the most of the web.

In time, the advent of optical switching and microphotonics - tiny optical transmission devices - will render the problem moot. But that technology will face a competitor: technology developed by TeraBeam Networks could go a long way in speeding up data flow between external computer networks, known as wide area networks, and internal ones, known as local area networks. The US-based TeraBeam has developed a fiberless optical system that delivers broadband capacity across the last mile - on a beam of light. "It's a revelation," says George Gilder, renowned futurist and fellow at the US-based Discovery Institute.

TeraBeam's system uses spectronics, an optical technology that's been around since the mid-1990s, coupled with holographic and telescopic technologies, to send a 'fuzzy' or 'expanded' laser beam from access points to transmitter/receivers placed in the windows of subscribing businesses. The system can transmit data at speeds up to two gigabits per second - 600 times faster than some alternatives.

TeraBeam's technology employs standard Internet security protocols, encoding data using methods much like those used by current mobile telephony. And it's inexpensive: transmitter/receivers, which are the size of a small satellite dish, cost around US$150 and take just a few days to install. TeraBeam says bandwidth costs will be kept low because it will be able to serve many customers simultaneously. A downside: the technology requires line-of-sight, so data transmission is killed by anything that blocks the beam. But TeraBeam says rigorous testing has demonstrated 99.9 percent availability, even in bad weather. Commercialization will be led by TeraBeam Internet Systems, a joint venture with Lucent Technologies.

Body Heat
Biometric security
ETA: 2003

Your face may not be your fortune, but at least it can be your password. In the Internet age that's no small consolation. With concerns about the protection provided by ordinary passwords and PIN numbers still a barrier to e-business, biometric technology should allay many fears.

Biometrics enable a computer to confirm an individual's identity based on a stable physical trait, such as your face, fingerprint or the iris of your eye. The iris, scientifically, offers the most detailed readings, but loses points for being a little more difficult to apply in real world situations. The field is boosted by the almost universal adoption by developers of a standard 'bio-API' (application programming interface), which Microsoft has started incorporating into its operating systems.

Once an inbuilt reading device - a webcam, say, or a fingerprint pad - has captured an image to use for measurement of the appropriate body part, software converts it to a digital code that is then encrypted. "It's a lot safer, there is nothing to remember and nothing to leave home without," says Dr Joseph Atick, CEO of New Jersey-based Visionics, a face recognition technology specialist. Already, Japanese companies NTT and Kyocera, for instance, are building digital cameras into mobile phones. "It's a new mechanism for creating digital certificates on the fly," Atick says.

The fingerprint seems less sexy, but has plenty of support. California-based Veridicom was set up in 1997 to commercialize breakthroughs made at Lucent's Bell Labs in New Jersey. Last November, Japan's NEC became the first to fit desktop PCs with fingerprint readers. A computer user can't start the log-on process without registering the right fingerprint. Lufthansa, Germany's national airline, is also using the technology internally.

Some companies have already embraced biometrics. InnoVentry, a subsidiary of US bank Wells Fargo, uses Visionics' FaceIT technology. The system enables InnoVentry to offer ATM-based financial services to customers who normally would be considered bad credit risks. Intel has also purchased Visionics' FaceIT system for internal corporate use.

On the Net Without a Wire
Wireless Application Protocol
ETA: 2003

Admittedly, you can't swing a cat these days without hitting a vendor pushing a wireless Internet product. The massive hype exists for one reason: the massive potential of the wireless Net. First, a little background. Most mobile data products are based on wireless application protocol (WAP). WAP is a data-delivery standard developed by three phone manufacturers and a software company. The protocol enables handheld devices (mobile phones, PDAs, etc) to hook up to the Internet. Before WAP, surfing the Net was like swimming in jello. Early WAP-enabled products haven't been much better, with consumer complaints about slow log-on times and lack of wireless content.

Nevertheless, the future of WAP - and wireless data - looks rosy. Japan leads the way in mobile data, with Europe fast closing the gap. Tapio Hedman, vice-president of communications at Finland-based phone maker Nokia, predicts that in three years there will be more mobile devices connected to the Net in Europe than PCs. "We don't only think that WAP is changing the way that companies do business," Hedman says, "it will ultimately affect the way that Net users use different services."

The key to WAP's future will be convenience, according to Rickard Gustafson, managing director of the European e-business group at GE Capital. If a shopper exhausts a line of credit while shopping, says Gustafson, "using his mobile he can go on-line and get a credit extension." Much will also depend on the ability of GPRS (general packet radio service), which vastly increases the data capacity of networks and phones. In Japan, which boasts a similar concept called I-Mode, sales of handsets have soared since its launch.

The Searchers
Software agents
ETA: 2003

The scarcest corporate resource isn't computing power or network bandwidth. It's time. Enter software agents, more colorfully known as softbots. These are mini-programs that relieve people of routine tasks by automating certain computing functions. Ultimately, experts predict softbots will exercise judgment on the user's behalf.

Some softbots serve as personal assistants, finding and filtering information. Others improve process and workflow across an organization and assist with network management and diagnostics. An agent might watch for a specified event in a computer system, for instance, and issue an alarm when it occurs. It's believed that corporate use of agent-based monitoring programs will dramatically pare IT support costs and boost worker productivity.

Softbots will likely be used in data mining, as well, performing inherently tedious searches in background mode. Mobile agents could even propagate across a network, camping where needed.

Examples of agent technology already abound. Networking giant Novell's DigitalMe initiative enables information to flow from a user's client device to an e-commerce server, automatically filling in forms on an e-shopping website - a time-saver for customers. And Hewlett-Packard Labs in Palo Alto has developed E-Speak, a platform that enables web-based networks of services to communicate with each other.

Scientists believe software agents will grow more sophisticated as artificial-intelligence techniques mature. A neural network can learn the nature of an on-line consumer's interests by correlating the locations the surfer visits and associated input. That way, the softbot can consistently deliver more content that's of real interest to the customer.

Casting a Wider Net
Internet2, advanced networking
ETA: 2003

The folks at University Corporation for Advanced Internet Development (UCAID), the Washington, DC-based secretariat for Internet2 (I2), keep a running tab on the most-asked questions about the initiative. Heading the list: "When can I connect?" Not far behind: "When is the IPO?" The answers are you can't and never. Far from being a specific technology, I2 is more a scientific playground that tries to recreate the R&D environment that spawned the Net and web in the first place.

Since its inception in the mid 1990s, UCAID has attracted 180 US academic institutions and 80 companies as members. The roster is a who's who of high-tech, as well as others, like JP Morgan, who want a front seat to the future. There are also links to smaller schemes in Asia, Europe and Latin America.

The old guard plays a key role too: Vint Cerf, a founding father of the Internet, is on an industry advisory council. The universities and colleges bring research skills; the companies contribute equipment and cash: Cisco Systems, alone, has given tens of millions of dollars worth of network routers to the cause, while Qwest has thrown in complimentary bandwidth.

Such companies take part because they could not replicate such a powerful, heterogeneous testbed by themselves. Says Heather Boyles, UCAID's director of government and international relations: "The projects provide a valuable space for companies to work together, in ways that would not be possible in normal commercial environments."

That work is conducted in three areas: applications, middleware (software that enables systems to work together) and networks. With time, it's believed I2 will give rise to dramatic network technologies such as IPv6 (next-gen Internet protocol), multicasting and Quality of Service (24/7 delivery of mission critical data and applications over the Net). Those innovations, experts say, should lead to lucrative commercial applications - things like digital libraries and virtual laboratories.

Pulp Fiction
Electronic paper, digital ink
ETA: 2003

The paperless office is a lost cause, says Nick Sheridon, senior research fellow at Xerox's Palo Alto Research Center (PARC). But the pulp-paperless office is another matter - and the reason he takes congratulatory calls from environmentalists everywhere.

Sheridon and his team are working on 'electronic reusable paper', based on technology called gyricon. This comprises miniscule balls, white on one side, colored on the other, that rotate in response to an electric charge - digital ink, in effect. To the naked eye the material resembles super-fine sandpaper between two sheets of clear film; under a microscope it looks like a biology experiment. While current incarnations are a little rough, Sheridon anticipates resolution equal to 300 dpi (dots per inch) - better than the typical print job. "It needs to share as many qualities of paper as possible so people will want to use it," he says.

US-based 3M has signed up to focus on production of the new paper, leaving Xerox to concentrate on devices. (An unnamed software company is also involved.) Wireless transmission of data will play a key role; one possibility is a wand-like instrument that the user would wave over a sheet, stimulating the particles to reassemble as new text and images. In other cases, data would be stored in memory chips implanted in devices. Either should be a boon to mobile workers.

Xerox's main rival is E Ink, which is commercializing technology developed at MIT's Media Lab. Backed by Hearst Corporation, among others, E Ink already has a billboard product on the market. Xerox is interested in this application too, but both sides know it isn't the main game. Real promise lies in newspapers and books, updating pages once read. The same goes for any disposable document, such as draft copies normally destined for the trash.

Sheridon expects the first Xerox offering to emerge some time next year. "It's a race," he admits. He reckons an A4 sheet will cost less than US$3, and be reusable up to four million times. Try doing that with a legal pad.

His Master's Voice
Speech recognition
ETA: 2004

Ardent sci-fi addicts could be forgiven for thinking that a few fantasy basics would have seeped into our lives by now. After all, it's been more than 30 years since Star Trek's celebrated Vulcan issued his first voice command to the ship's computer and most of us are still tapping away at our keyboards.

Nevertheless, speech recognition is slowly catching up with its promise. "We're at the point now where we have real applications, real communication products," says Nelson Morgan, director of the International Computer Science Institute at the University of California at Berkeley. But, he adds, they are aimed at the simplest applications, such as dictation products.

Audio mining, the ability to search and retrieve chunks of spoken data, is just a bit further out, according to Morgan. Currently, the technology requires a controlled environment, careful use of microphones and expensive equipment. But in a few short years, it's possible that a pair of finance managers could chat in an airport lounge, record the text on their PDAs, and search it back at the office.

Voice Signal Technologies, based in Massachusetts, is working towards embedding speech-recognition technology in a variety of appliances, from cell phones to automobiles. And researchers at MIT's Laboratory for Computer Science have developed a half-dozen voice-driven applications that provide everything from weather information to airline schedules.

The Holy Grail of speech recognition, of course, is speech-to-speech translation. That's the target of researchers at Carnegie Mellon University's Language Technologies Institute in Pennsylvania. LTI's Janus system translates from English or German into English, German or Japanese. Commercially available systems that allow users to move beyond narrowly defined subject matters are still at least several years away. But speaking into a telephone in English, and communicating, at least in a rudimentary way, with someone who speaks Mandarin, finally sounds like a possibility. Such applications also hold real potential for companies that sell globally over the Internet.

The Third Dimension
Holographic data storage
ETA: 2005

"Information is now the customer's number one asset," said Bill Monahan, CEO of Minnesota-based storage technology provider Imation, at the launch of the company's financial results earlier this year. "They will need more storage, better management capability of storage and new services."

Truer words have rarely been spoken. The Internet and corporate intranets place unbearable strain on the computer capacity needed to store text, graphics, images, video and sound. Rising to the challenge, the storage densities of traditional two-dimensional media - such as magnetic disk, optical disk and magnetic tape - have increased at over 60 percent annually in recent years. But gains have come by packing and stacking data 'bits' closer together, an approach that is believed to be reaching its limits.

Scientists some time ago realized that by storing information in three dimensions they could increase capacity dramatically. That's where holographic storage comes in. A hologram is produced when a beam of laser light, known as the 'reference beam', interferes with another beam reflected from the object to be recorded. The pattern of interference is captured by photographic film, a light-sensitive crystal or some other optical material; illumination of the pattern made by the reference beam reproduces a 3D image of the object.

A block of photo-refractive material a few millimeters thick can record and store hundreds of images at different angles, without cross-interference; each viewing angle provides a different view of the same object. Holographic data storage works in a similar fashion, except that for every different angle there is a completely different page of information.

Imation is collaborating with Lucent Technologies to build on holographic technology developed at Bell Laboratories. Imation reckons the partnership will produce a commercial holographic disk product by 2003, in the form of a 125 Gbyte, write-once, read-many-times disk with an access time of 50 milliseconds. Future generations of devices should accommodate around 1 terabyte on a single disk.

Still, holography is not a panacea. The technology is not digital, so additional processing is required for a computer to read the data. And new media is needed to accommodate holograms in a cost-effective form. Initially, holographic storage will complement traditional storage technologies rather than replace them.

Wired and Emotional
Human-computer interaction
ETA: 2005

Dan Russell is a man with a plan. Russell, head of user sciences and experience research at IBM's Almaden Research Lab in Silicon Valley, wants to make the relationship between humans and computers, well ... more, personal. After all, the basic computing experience hasn't changed much since PCs first showed up on everyone's desk. "The best analogy I can give is that the design of amusement parks took a major shift when Disneyland opened [in the 1950s]," Russell says. "Until that point, amusement parks had been assemblages of rides, but Disney designed an experience." Computing is like that, too, Russell says. "Right now we've got a motley assembly of applications on the desktop. There's no reason they can't be more coherent."

While voice plays a central role in human-computer interaction, IBM wants to shift more of the burden to the machines by exploiting nonverbal cues. The US company's BlueEyes project uses a camera to read the computer user's gaze. One prototype technology, SUITOR (Simple User Interest Tracker), fills a scrolling ticker on a computer screen with information related to the user's current task. SUITOR knows where the individual is looking, the applications that are running, and the web pages that are displayed, and suggests complementary paths of action.

Experts are also measuring the heart rate, temperature and minute body movements of human test subjects, then matching these with six emotional states: happiness, surprise, anger, fear, sadness and disgust. The next step would be infrared or temperature-sensitive devices, embedded in a chair, keyboard, mouse or telephone, to take readings from the user. The computer would gauge the emotional state of the user, then adjust the presentation of information accordingly. This might sound a bit creepy, but backers believe such customizing will increase worker productivity dramatically. Disneyland on a desk, anyone?

Adam Lincoln is a senior writer at CFO Asia. Additional reporting by Louella Miles in London, Tom Duffy in Boston, and Dave Cook in New York.