Silicon Insider: The 'Third' Screen Revolution

The PC era is ending, not with a bang, but a ring tone.

There were two very interesting news items this week — one that received a lot of attention, and one that got very little — and for once, in tech, the weighting was appropriate.

The story you probably did notice was the announcement by Google that next week, it will release a new software platform, called Android, that will enable developers to create programs to make mobile phones easier to use and more efficient at manipulating the Web. Google backed this announcement, saying it will begin working closely with the major coalition of phone equipment developers, known as the Open Handset Alliance.

The initial reaction to Google's announcement was dismal: rumors had been flying around Silicon Valley for months that what was going to be announced was an actual Google Phone. Hungry, early adopters drooled at the prospect of an all-out Apple iPhone vs. Google Phone war, which would leave the traditional phone industry behind and shower us consumers with ever-cooler devices at ever-falling prices. Thus, Google's announcement was something of a letdown.

But once they got past their disappointment at not being able to hold, in their hands, an actual phone with the Google logo on it, the gurus of Silicon Valley began to realize that, ultimately, Android might be far bigger news in the long run. That's because, in introducing an open platform for wireless, Google had at last put into place the missing piece in the long-awaited breakout of the so-called "Third Screen" revolution.

In a wonderful alignment of the cosmos, the other, mostly overlooked big tech story of the week had to do with the "Second Screen" — personal computers.

Remember personal computers? Remember how they used to be the hottest thing in technology? Remember how we used to excitedly await the newest Macintosh or the latest update of Windows?

I'm only being partly facetious. For most of us, the PC era has been the electronics revolution, everything else playing a supporting role. It was personal computing that brought most of us into the electronics age, put us on the Internet, and was consistently one of our largest capital expenditures. Thanks to the constant upgrading of PCs, because of the pace of Moore's Law — meaning we replaced our machines every few years — these devices have seemed perpetually young and new.

Because of that, it's easy to forget that personal computing is now more than 30 years old. Woz and Jobs were building the Apple I during the Bicentennial year. There are kids now in graduate school who were born the year the Macintosh was introduced. And the original IBM PC was introduced in the first year of the Reagan administration.

In other words, in tech years, this is an ancient paradigm. Those of you who have read this column from the beginning may remember that five years ago, I predicted the end of the PC era, saying that microprocessors were now leaving the box and embedding their computing power into the larger world.

Needless to say, I was a bit optimistic. I had also not listened to one of my own laws, which states: Every technology revolution arrives slower than we anticipate, and faster than we are prepared for.

End of the PC Era

Now, for PCs, that day has come. That second story came out of Japan. It seems, overall, PC shipments in Japan, that bellwether of consumer tech, have now fallen for five consecutive quarters, the first long-term decline ever recorded for this industry. When GDP slides for five quarters, we call it a major recession; in personal computers, I think we can call it the end of an era.

Industry analysts seem to agree. According to the International Data Corporation, second quarter shipments of desktop computers in Japan fell 4.8 percent, laptops 3.1 percent — and it predicts that the future doesn't look any brighter.

Already, Hitachi has announced it is pulling out of the home computer business, and NEC and Sony now appear to be shifting their marketing efforts to the developing world, where PCs are still comparatively rare. It now seems very possible that Japan will soon become the first industrialized country in the world to see an actual decline in computer usage.

When it comes to consumer tech, as goes Japan, so goes the rest of the world. The PC era, which defined the modern world in the last two decades of the 20th century, is now over.

With this new perspective, it's interesting now to look back a few years at some important decisions made by some very famous corporations. For example, IBM's decision to get out of PCs now looks like genius — as does Lenovo's decision to get in with a proven architecture and sell to the developing world.

Steve Jobs, always the genius, adds one more feather to his hat by racing into the MP3 and phone worlds, while dropping "Computer" from the company name. Meanwhile, Carly Fiorina, who wanted to turn HP into the world's PC leader, and Michael Dell, who let his company get into trouble during the last great era of profitability in PCs, are the goats of this end game in personal computer.

Meanwhile, in a beautiful symmetry, Google's announcement officially shifts the electronics revolution to the "third screen" of cell phones, BlackBerries and other handheld devices. Cell phones, obviously, have been around for some time, as have smart phones.

But I think history will likely record all that's happened in the wireless world up until now as merely prelude. In 2007, the stars have all finally aligned. Established cell phone makers, like Nokia, have come out with spectacular new smart phones with a raft of new features. Jobs and Apple set the world on its ear with the introduction of the iPhone. And now, the world's hottest company, Google, has announced the de facto software platform for the industry.

With a few important differences, it is now Apple v. Microsoft all over again. Closed system versus open, the clever David of Apple versus the relentless Goliath of the rest of the mobile world.

And the ironies are everywhere: Jobs finds himself back where he was in 1982 — only this time he's come to the party late and appears to have, at least partly, learned his lesson about holding too tightly to his proprietary code. Eric Schmidt has spent much of his professional life trying, and failing (at Sun and Novell), to defeat Bill Gates. Now, in this new era, Schmidt has become Gates. The only unanswered question now is: who will be the new Michael Dell?

In the meantime, get ready, because it is going to be a very exciting ride for the next 20 years.

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This work is the opinion of the columnist and in no way reflects the opinion of ABC News.