Monday, November 24, 2008

Dramatic Internet Growth -- Incredible Wireless Growth

According to stats from PAIX, Internet traffic around the world is growing 65% per year! Wireless traffic is growing 400% per year!

After the holidays, a long list of stores will close, Linen and Things, J. and Jill, numerous video rental stores and book stores, etc. A regular reader notes that one should be careful when giving gift cards. Even chains that are not closing will close many stores. Card holders may lose their gift or have a difficult time in using it.

An old friend, who is Internet challenged, recently bought a wedding gift online. Like many men, this fellow does not enjoy shopping. He was tickled to be able to see pictures of register items, to easily pick one on line and to have it delivered. This is old hat for so many of you but it shows how the Internet is gradually spreading. In the short run, the Internet is contributing to the problem of too many goods chasing too few dollars but in the long run to a higher standard of living for all.

400% annual growth in wireless traffic! As in all economic rotations, just as one business flounders another one takes off. Larry Kudlow would call the wireless traffic growth a mustard seed. It is that and more. It represents a paradigm shift, a game changer, a new way of living. It represents much more than checking ones email on the road. Talking computers that accompany us where ever we go will prove to be invaluable, a necessity for living a "normal life". My Dad passed away 4 years ago without ever owning a cell phone, Mom goes nowhere without hers. She is 86 and still getting accustomed to searching the web. She will want a web connected phone before too long. This product has broken through the early adopter's stage and has entered the rapid growth phase during which half the people will buy.

All components of this business are very competitive. Winners could range from AT&T to SamSung but I believe Google will be the biggest big winner. The small software firm that creates the best new application will soar but the day to day search is going to give Google steady but dramatic compounded growth.