A technology forecast sometimes isn't worth the fax paper it's printed on. Remember visionary Bill Gates' infamous 1981 proclamation, "640K ought to be enough for everyone"? Well, most home computers now come with at least 16 megabytes of memory at the low end, with demands increasing as new products are rolled out at lightning speed.

And to pick on Gates a little more (he can afford it), recall that the Microsoft chief felt it was important to release a new version of his far-seeing book, "The Road Ahead," "to include the Internet." OK, nobody's perfect.

PricewaterhouseCoopers puts its neck on the line each year with its own technology forecast. The company's 10th annual look-ahead weighs in at 824 pages, covering every aspect of technology from wireless telecommunications to microprocessors, data warehousing to network management.

This year's focus: "The Telecommunications Revolution."

"Forecasting is fraught with peril," offered Contributing Editor Eric Berg, director of technology analysis in the strategic technology services group at PricewaterhouseCoopers' Menlo Park Technology Center.

Why telecom this year?

"Historically, telecommunications has been one of the most heavily regulated, state-owned industries," Berg said. "That's a striking contrast to the computer industry," which has been allowed to flourish and grow on its own.

But that's all changing now, according to Berg, who said that the world of telecommunications is beginning down the path that computing has been traveling for the past 30 years, thanks to the 1996 deregulation. New providers are entering the market, technology innovation is accelerating, and a blizzard of new products and services are being introduced.

"Performance requirements are growing faster than telecom technology," Berg said. "Traffic on the Internet is doubling every 100 days." The traditional network of copper phone lines that was fine for carrying voice traffic is collapsing under the pressure of data traffic.

"Telecom is turning its back on the 100-year infrastructure," Berg said. This infrastructure, called the circuit-switched network, transmits information between two connected parties for the length of their call. To carry data and voice, a new network, called the packet-switched network, will replace the old standard. Information on the packet-switched network is broken up into digital "packets" that are transmitted independently and then reassembled in the correct sequence at the destination.

Qwest and Level 3 are two companies that offer phone service based on a packet-switched network.

"AT & T; announced that it is only buying packet-based equipment, and this is going to have a tremendous influence on equipment makers," Berg said. Aside from a major infrastructure transition, PricewaterhouseCoopers said the growing race to supply greater bandwidth data-carrying capacity in a circuit will be run by a number of firms who are crossing their traditional business lines to enter new technologies.

For example, the battle between cable and phone companies to provide high-speed Internet access is creating some non-traditional bedfellows. The merger between AT & T;, a traditional telephone company, and TCI, a cable company, reflects this convergence, not to mention AT & T;'s recent plan to acquire MediaOne.

Irvine-based Broadcom Corp. is an example of the convergence trend. The chip maker recently signed a deal with Canadian phone giant Nortel Networks to supply Broadcom's VDSL (very-high-data-rate digital subscriber line) chip. Nortel will use the chip to provide high-speed Internet, phone and video services over traditional copper lines. Broadcom has traditionally sold its chips to cable TV companies and set-top box makers, but the deal with Nortel allows Broadcom to hedge its bets among different competing technologies that hope to dominate the Internet and data-transmission markets.

For its part, Nortel has been reinventing itself over the past year. The company has traditionally sold equipment to help carry voices over phone lines. But in January 1998, the company jumped into the fast-moving group of companies that are providing voice and data over the same pipelines, like the Internet.

In Orange County, Pacific Bell offers digital subscriber line (DSL) service to its customers. DSL uses traditional copper lines to transmit data and voice but adds improved electronics to yield higher bandwidth. A chief competitor is Cox Communications, which provides voice and data connections over cable.

A third trend is the merging of telephone devices and hand-held computers. "The wireless network can be relatively slow," Berg said, "so we will need new protocols."

The so-called third-generation phone (3G) promises to provide voice, data and Internet services on hand-held phones.

Indeed, in April, Samsung will be first to market with what it calls an "Internet phone." It comes with a touch screen and features an electronic notebook, PC data interface, wireless fax and Internet access. A bible/Christian hymnal and Buddhist Canon/Buddhist songbook are built in, as are electronic games such as Tetris and crossword puzzles.

Oh, yeah, you can make a telephone call with it, too.

Mike Mason is a staff reporter with the Orange County Business Journal who covers the technology industry.

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