This years sign for computer and electronics buyers reads: Price Curve Ends Ahead. Surging demand for semiconductors and aftershocks from last year's Taiwan earthquake, which disrupted that island nation's chip production, are putting an end at least temporarily to the constant downward spiral in hardware prices. Industry analysts predict chip sales will grow 20 to 25 percent this year, up from about 18 percent growth in 1999, while the next-generation of chip-making plants won't come on line until 2002 and 2003. The result is pure Economics 101: Chip prices will either increase or hold steady, instead of continuing the recent pattern of steady erosion. All chip-dependent devices from PCs to digital cameras to high-definition television sets will be affected. However, sticker prices for PCs aren't likely to increase, since manufacturers instead are planning to trim features. A $999 PC on sale this summer, for example, might have 64 megabytes of random-access memory instead of the 128 megabytes of RAM originally planned at that price point.
Windows 2000, according to Microsoft Corp., is everything business owners could want in an operating system. But upgrading to the new OS may be out of reach for many companies. Win2K, as some are calling the software, is nearly crash proof and offers important features for remotely managing PCs through the network. Yet the "professional" version of Windows 2000, meant for individual desktops, requires 64 megabytes of RAM and, as Microsoft says, "more memory generally improves performance." The OS also gobbles up 2 gigabytes of hard-disk real estate, and requires another 1 gig free for a work area. Also, Windows 2000 may not recognize key peripherals such as CD-ROM drives and printers on older PCs: One way the new OS avoids freeze-ups is through strict compatibility guidelines for hardware and software manufacturers who want Windows 2000 certification for their products. But few companies have completed the certification. For now, businesses are best advised to order Windows 2000 pre-installed on new systems, and hold off on upgrades of existing computers.
Nobody Knows the Traffic I've Seen
One of the most delicate balancing acts in the uncertain world of electronic commerce is the tightrope walk between violating customer privacy and maximizing business opportunity. Powerful software tools from companies such as Be Free Inc., DoubleClick Inc., Engage Technologies Inc., and MatchLogic Inc. make it possible for online merchants to track every step a consumer takes on the World Wide Web. They can use that information for targeted marketing offering tour packages, for example, to someone who frequently visits airline ticket sites. But such monitoring runs the risk of a consumer backlash. Several companies including Anonymizer.com, Privada, and Zero-Knowledge Systems Inc. are offering free or low-cost services that let individuals adopt untraceable aliases in cyberspace. Meanwhile, Congress is considering legislation to protect privacy on the electronic frontier.
The Code War
Modern data encryption technology is so advanced that almost any business or individual can send encoded messages and transaction information that is impenetrable to all but the most highly powered computers. Of course, not many do. But that may change with the introduction of new federal regulations, expected to take effect in mid-May, that finally eliminate long-standing barriers preventing the export of robust encryption software. The spread of strong encryption should help build Internet commerce worldwide by allowing buyers and sellers to meet on line without fear of electronic tampering or theft (as well as help U.S. encryption software makers compete with their counterparts in other countries). Previously, if you encoded a message and wanted to send the overseas recipient a program to decode it, you were considered to be violating U.S. laws banning the distribution of weapons and armaments.
Trash or Treasure?
Getting rid of old, outdated computer equipment is a little more difficult than dropping it curbside like an old fridge. EPA regulations prohibit the landfilling of computers, because the circuits include toxic elements such as lead and cadmium, which can contaminate water. So figuring out just where and how to get rid of them can be difficult.
In general, disposal of old PCs should be left to professional recycling services. Though some will still pay for your defunct desktops, the street values are so low that many now actually charge businesses to take them off their hands, according to Dan Bayha, vice president of Back Thru the Future Microcomputers Inc., a recycling company based in East Hanover, N.J. His company will take care of your trash for a fee of about $10-$20, not including shipping charges.
A better choice may be to donate the equipment to a local charity businesses help the community and take a small tax cut to boot. But charities are picky about what they'll take these days, so check first. For instance, The National Cristina Foundation in Stamford, Conn., takes working computers up to 10 years of age and redistributes them to nonprofit organizations that educate the disabled and financially disadvantaged. But the East-West Educational Foundation Inc. in Boston, Mass. only accepts Pentium computers that have at least 75MHz to 90MHz. It then refurbishes them for schools and nonprofits.
Believe it or not, some organizations may not even want PCs. "When you donate equipment to places like the Salvation Army, you are just passing the cost of recycling on to them," says Back Thru the Future's Bayha. "Those organizations are seeking newer technology." Likewise, schools typically want newer technology.
Not all nonprofits handle tax deductions the same way, either. The NCF provides a receipt listing the fair market value of the system, but the EWF, because of IRS restrictions, provides only letters of acceptance stating that the donation can still be used as a write-off. And although the organization doesn't offer pickup outside of the Boston area, shipping costs to nonprofit organizations can be used as a tax deduction.
So what's right for your business? Yvette Marrin, president of the NCF, offers one guideline: "If you have working computers, definitely give them to an organization like ours. If they are not working, recycle." And if that doesn't work, you can always turn that dead monitor into an aquarium.