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This article by Richard K. Rein was prepared for the May 19, 2004 edition of U.S. 1 Newspaper. All rights reserved.
The King of Clutter
Human resource consultant Niels Nielsen called the other day to say that I ought to pick up the May 10 issue of Business Week, the one with the cover story titled “E-Biz Strikes Again,” highlighting six industries that the magazine predicts will be revamped by the Internet in the near future. “What’s amazing,” said Nielsen, calling me just before dashing off to an HR conference in Boston, “is that you’ve had representatives of at least half these industries speak at your technology showcase at one time or another.”
The mere mention of Business Week sends shivers up my spine. It is part of the crown of thorns I wear as the King of Clutter. Several years ago I got a letter from Business Week in the mail. I assumed it was a typical subscription requests, but something about it was a little different and I opened it. Instead of asking me to subscribe, it politely requested that I pay for my subscription, which had expired. I dismissed that letter, and then began to notice a succession of other, increasingly less polite calls. Finally I got a call from a collection agent. No, I told the caller, I would not pay for a subscription I had never ordered and in any case had never received.
That ended my relationship with Business Week. A year or so later, I was clearing a stack of old newspapers and files from a corner of my office. Several feet into it, I noticed some printed matter enclosed in an unopened plastic wrapper. It was an issue of Business Week. I dug deeper, and discovered more issues of the magazine, all still in their plastic wrapper, and all with my name typed on the address label: The King of Clutter.
So still feeling a little guilty about my dealings with Business Week, I marched down to the kiosk in Palmer Square and happily paid $4.95 for a single copy of the issue. Sure enough, for all of those who lived and then died by the Internet, Business Week offers compelling evidence that the medium is here to stay, and might even prove to be profitable.
The Business Week list of E-business opportunities includes software, in which code development now takes place largely over the Internet; real estate, a field in which Internet-based middlemen are now augmenting the services of many traditional brokers; hotels, where the Internet is permitting travelers to shop around for the best rates before they reach their destinations; and three industries that have been discussed at our annual U.S. 1 Technology Showcase:
1.) Voice over Internet Protocol. This is refashioning the image of telecom, says Business Week, and even the big players like Verizon have admitted that they underestimated the potential of routing telephone calls over the Internet at prices far cheaper than the conventional methods.
Sure enough, back in 1998 Mary Evslin of ITXC spoke at the Technology Showcase. If we had all invested in the stock in 1999 (and then sold it before the meltdown in 2000), none of us would be here today to read about it. Today the sale of ITXC to Teleglobe in Montreal is about to be ratified by shareholders.
2.) Online bill payment and check processing. It’s a $30 billion industry, says Business Week, and the Internet has already changed the way checks are printed and shipped around the country. The upheaval will continue when Check 21 takes effect in October — that’s the law that says electronic images of checks will be equal in the eyes of the law with paper originals.
In the thick of all this was Paytrust. The company co-founder, Ed McLaughlin, spoke at the U.S. 1 Showcase in 1999. The other founder, Flint Lane, runs BillTrust on Everett Drive.
3. Online retailing of jewelry and diamonds. Business Week says that $2 billion in sales are made online a year, still a small portion of the industry’s $45 billion market. But sales are booming, and just last month Amazon.com jumped into the fray. The magazine quoted a jeweler from Lambertville, of all places: “Anyone with half a brain who wants a diamond engagement ring will go to the Internet.”
Now I scratched my head and tried to recall anyone who spoke about selling jewelry at a U.S. 1 Showcase. Not a soul. Niels Nielsen must have been off the wall when he gave us credit for having such prescient speakers. But then I dug into the cluttered recesses of my brain and recalled Jim Medalia, founder of JustBalls, the once-celebrated firm that hoped to build an empire by selling balls, or bats, or hats, or anything else that institutions might buy in large quantities and that did not need a lot of after-sale follow-up. Medalia, who spoke at our 1999 showcase, liked to point out that someone buying a soccer ball didn’t expect to get a 75-page manual with it. And not too many people ever returned a soccer ball because it didn’t fit.
Justballs never made it. But the principles Medalia espoused made a lot of sense then, and no doubt make an even greater profit now when applied to a high margin business like jewelry. I don’t know who will speak, but I will be there on Thursday, September 2. This time I’ll take notes.
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