The Internet enters a bold second act

The rise of wireless online networks adds to the potential for price wars. These networks compete with phone and cable wires to take people online. They also could give consumers an alternative to traditional cellphone voice traffic.

"It's good for everybody except possibly the providers" of all these networks, says Allyn Hall, an expert in wireless technologies for the market-research firm In-Stat, in Scottsdale, Ariz.

Advertising revenue may help Google or some other bidder to finance a free wireless network that San Francisco hopes to create.

Such efforts, under consideration in other US cities, represent a direct challenge to traditional phone companies. So it's likely they will fight back not only with rival service plans but also by lobbying lawmakers and regulators.

"Never bet against the regulated providers," Mr. Hall says.

But in this battle to provide access to an array of online services, the winner will be "perhaps less dependent on technology than on other factors like marketing," he says.

The providers of content, such as media conglomerate Time Warner, face a different set of challenges. As content goes digital, these firms are learning to get consumers to pay for the information and news they get online. And they're finding more advertisers who will help foot the bill. By 2010, online ad revenues are expected to more than double from last year's $9.3 billion.

The problem of illegal copying, which has plagued the music industry, must be solved anew for video products as TV goes online.

Whatever the hurdles, Time Warner CEO Richard Parsons recently said the Web - specifically his company's troubled merger with Internet service provider AOL - is where the "growth opportunity" lies.

Mainstream high-tech companies are also scrambling for their place in the wild wild Web. The most closely watched battle pits Microsoft, the dominant software provider for personal computers, against Web-search giant Google.

"Google is certainly the best candidate that's come along in a long time to displace Microsoft," says Joe Wilcox, a senior analyst at Jupiter Research.

That doesn't mean it will. Microsoft is famous for tenaciously fending off threats, and has recently reorganized, in part to strengthen its MSN Web services. The company has also discussed a possible alliance with AOL.

But Google embodies a whole new model of computing.

Where Microsoft has traditionally helped people make the most of their own PC, Google wants the Internet to be a giant personal computer for the planet. It's stated mission is "to organize the world's information and make it universally accessible."

The more the Internet becomes such a tool, the less important traditional desktop software like Microsoft's becomes. The PC becomes just a way to get on to the Web.

Mr. Wilcox isn't counting Microsoft out just yet. But "Google could be in a very good position if it executes well," he says.

And as all these battles shake out, consumers stand to be in the best position of all. Their main challenge may be the old one of competing standards. Remember Betamax vs. VHS? Today, consumers could pay $299 for an iPod, only to find that next year's music player comes from a different company.

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