For a preview of the computer that's headed your way, sneak into your teenager's bedroom. Ignore the dusty Dell, Mac and even the iPhone--marvel instead at Microsoft's Xbox, Sony's PlayStation or Nintendo's Wii. For a preview of what you'll be doing on such a machine, don't waste time trying to type a letter--where's the keyboard, anyway?--or run a spreadsheet, or Google a search, or crawl through Ebay or Amazon. Go kill someone in Halo 3. And if you can work out which tech company is building the very best graphics chips, processors and joysticklike gadgets to wire the box to your kid's brain, buy its stock.
This story begins somewhere quite different: Fiber-optic glass is the next tsunami in the digital revolution. Glass has been the backbone of telecommunications for decades, of course--but now the glass is coming to the desktop, and in due course it will wash away all the hardware, software and Web content created for the metal-wire world. About 6.5 million Verizon (nyse: VZ - news - people ) customers can already run glass right to their desks, and at 50 megabits per second, it's at least ten times as fast as whatever you've got now--fast enough to put two high-definition tv signals on your computer screen simultaneously and let you broadcast at least one normal tv channel of yourself onto the Web at the same time. Many more phone and cable companies now have fiber within a few hundred yards of most of their customers. But skeptics are asking: Who needs it? You do.
Let's not forget how rotten today's Web really is. Amazon is useless if you love picking your way through books stacked high on tables, flipping pages and skimming dust jackets. Normal people don't shop for groceries by clicking boxes on a meticulously prepared list; they make choices as they stroll down aisles packed with merchandise. Or, for an expert opinion on your so-called digital life, drag your teenager away from his Xbox to help you shop for a new minivan. Show him the neat video feature that takes you inside the car through the lens of a camera that you can pan, tilt and turn with your mouse. Tell him you think it's "way cool." He won't know whether to laugh or to cry.
The graphics on his Xbox are cool. And while his fancy joystick can't type, it can move him through virtual space a whole lot better than a mouse can. The Wii remote incorporates motion sensors, and, primitive as they still are, they let you stand in your living room really swinging a "Wiimote" bat or club at the virtual ball. If you could plug a strand of glass into the far side of the box, you could race the dealer's virtual minivan on a Nascar track against Richard Petty.
Back in the here and now, digital life's two woeful deficiencies are both centered on the last yard of the network, where the bit meets the brain. Our eyes can process images far faster than the wire plugged into the back of the box can deliver them. And our brains can crank out signals--through vocal cords or fingers--with far greater speed, dexterity and sensitivity than today's man-machine interfaces can match. This one area of computing is still stunningly primitive. Touch typing is a century old. A mouse is only a modest advance over a telegraph key.
But laser light channeled through glass fiber can move pictures faster than the eye can see. And with micromechanical and semiconductor sensors, it's now possible to build gloves as digitally sensitive as human hands, or systems that move the image on the screen in response to how you move your head and eyes. The digital revolution is now waiting for these technologies to converge and proliferate. Then the revolution starts all over again.
Like the prior rounds, this one will offer plenty of opportunity for upstarts to dethrone the old guard. Google (nasdaq: GOOG - news - people ) rules text-centered searching today, but searching images and videos is so much more difficult that it will require completely different technology--probably highly specialized chips to mimic the incredible processing power embedded in our own visual cortex. Maybe Microsoft (nasdaq: MSFT - news - people ) will get there before Google. Apple (nasdaq: AAPL - news - people ) has been surging on beautiful designs and has led the way in a lot of graphical applications--but it has been quite a laggard on the input/output side of things, taking weird pride in clinging to its one-button mouse. Entertainment leaps into a whole new realm when technology can fuse the game box's power to place you in the middle of the action with action supplied by nfl helmet-cams or Hollywood stuntmen.
Who will dominate this new space is still anybody's guess. But if you're going to invest in this industry at all, never fall into the trap of believing that things are slowing down and dominant companies are settling in. In the digital world nothing is permanent, except change.
Original Source: http://members.forbes.com/free_forbes/2007/1112/074.html