VCs Expect FCC to Revolutionize Devices, Media through Wireless Broadband

“It’s the most important thing we could get done the next 10 years,” Doerr said of wireless: “Who’s going to dislike it, apart from the incumbent monopolists?” Intel is putting Wi-Fi and WiMAX capability in the same chips, which will be in all new notebook computers within a couple of years, he said. Competition from such a standards-based broadband data network would kill mobile carriers, Joe Schoendorf of Accel Partners said, cautioning that in his tenure former FCC Chmn. Michael Powell “couldn’t get it done.”

Ubiquitous, nearly free wireless access would be “so transformational” that smartphones largely would displace PCs, Doerr said. Apple’s iPhone will make the biggest splash, he said; that company has 100 million users trained to sync PCs with iPods, whose functions will be incorporated in iPhones -- a head start no one can compete with. “The iPhone will break the barrier for people watching video on the phone,” said moderator Tony Perkins, AlwaysOn editor-in- chief. Effects on wired hardware will ripple from there, said Roger McNamee, Integral Capital Partners. Mobile devices could capture and store all kinds of content on the fly, including for use on TVs and other players, he said: “Why is a TiVo a wired device… What an incredibly dumb idea.” The same goes for the Slingbox, he said.

But specialized mobile devices will supplant all-in-one handhelds in a “real dramatic fragmentation,” McNamee said. Nokia and Motorola, with multiple “design centers,” are in good positions, but “Windows Mobile is toast,” he said. “We will soon own dozens of devices,” especially with arrival of portable displays that are flexible, Schoendorf said. Steve Jurvetson, Draper Fisher Jurvetson managing dir., said he’s no believer in “convergence devices,” either -- but neither does he expect people to “carry an armada of devices.” Access to a wide variety of Web services will eliminate the need to use a wide variety of products, Jurvetson said.

Mobile devices’ “unstoppable demand for memory and storage” dovetails with a Jurvetson prediction that advances in memory will outrun those in logic in ICs, McNamee said. Memory, storage and low power demands matter much more than logic to these gadgets, he said. Nanotech breakthroughs lend themselves to beefing up memory more than logic, Jurvetson said. This will make memory cheap compared with logic and shake Intel and others in the chip industry whose priority has been optimizing processors for logic rather than memory, he said. Nvidia and other graphics-chip makers are “really the exception” to a trend in which giant companies will crush smaller processor companies, Doerr said.

Consumers creating media will undermine media companies, requiring a “reengineering” of the ad industry, McNamee said. Web 2.0’s essence is “self-expression,” he said, adding that this is more than a generational trend. Digital photography has been “transformational” for people of all ages, he said. The direction in which consumer technology is moving “bodes very poorly for a lot of big branded products [and] all media conglomerates,” he said. News Corp. is the one media company that will emerge a winner by plunging into Web 2.0 businesses involving users’ posts and sharing, Perkins said. If Procter & Gamble switches from TV and print ads to emphasizing online ads, that could be “a tipping point,” Schoendorf said, predicting a watershed will come soon.

User-created ads present companies with major brands a huge dilemma, Jurvetson said. They know such ads can give them enormous “lift” compared with professional ads -- but they fear loss of control, he said.