Nick Clayton

A PART of the internet died last week when AOL took over TimeWarner to create the largest media conglomerate in the world. Theevent marked the end of the internet's age of innocence.

An oft-repeated phrase used to say of the internet: "Incyberspace nobody knows you're a dog." In essence, that meant thatanybody could set up a website and the outside world would not beable to tell whether it had been created by a multinationalconglomerate or a teenager in his bedroom. That is definitely nolonger the case.

Increasingly, the cost of technology is becoming prohibitive forall but the biggest companies. And that can only continue.

This year will see the commercial introduction of extremely fastinternet connections that will be within the financial grasp ofordinary households. Cable modems and DSL using ordinary phone lineswill allow viewers to watch broadcast-quality programmes over theinternet. Television sets hooked up to this technology will allowviewers to watch any programme or film at any time they want.

That in itself does not prevent anybody running a website fromtheir bedroom, but they are going to have to compete against somevery big players from the world of entertainment. Companies such asTime Warner already have a great deal of material available fordistribution over the internet. Any competitor wanting to buy moviesand programmes, or make them, will find it extremely expensive.

There is also the very high cost of equipment. As anybody knowswho uses the internet now, it is prone to slowdowns and bottlenecks.If a website is competing with conventional television channels itcannot afford to be unavailable or jerky. Viewers will go elsewhere.

An even bigger cost will come in the form of marketing. It is nogood having the best website in the world if nobody knows it isthere.

Currently, e-commerce sites are spending a minimum of four timesmore on marketing than the actual cost of the site. It is impossibleto escape the adverts on television, in newspapers and on hoardings.

The AOL takeover of Time Warner shows the internet following thesame historical pattern as other media, but bigger and faster.

If you look at the early days of cinema, for instance, anyentrepreneur with a film and a projector could set up in a tent orhall to show movies.

Setting up a newspaper was a bit more expensive, but it was notbeyond the means of an upper middle-class individual with somethingto say.

Few people now would consider the possibility of launching anewspaper or making a film for distribution and it looks as if theopportunity to start a web-based business is heading the same way.That is not to say no web businesses will be launched, but thechances of creating a new Amazon or Yahoo! will be very muchdiminished.

The speed at which the internet has changed can be seen from theway that technology behind the web on which these businesses arebased did not exist before 1993. It has taken just until now for itto move out of the reach of mere mortals.

AOL, at 14 years old, is positively geriatric in internet terms.And until two years ago it could as easily have died as lived. Thefact that it has never been the best or the cheapest internetservice provider has been buried beneath a marketing technique AOLboss Steve Case calls "carpet bombing" - putting CD-Roms inmagazines, newspapers, cereal packets and even airline meals. It ishard to see who could compete with that.

In a year's time, when the AOL merger with Time Warner iscomplete, this media conglomerate will represent the internet to alarge part of the world, not just the United States. Europeans willbe able to watch US channels, or Dutch pornography for that matter,and the internet will have made the transition from academic tool tosouped-up television.

It may still be the case that nobody in cyberspace will knowyou're a dog, but nobody will be able to hear you bark either.

nclayton@scotsman.com