Hamish McRae: Brace yourself for a new revolution

Computers will go on advancing, but more important will be the changes they make to the fabric of our lives
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Vista launched in Britain yesterday, the latest, and some think the last, of successive generations of Windows operating systems. At one level, this is just another commercial product launch, the equivalent to the new generation of the Mercedes C class. It so happens that Microsoft has nearly a global monopoly on operating systems, so the lack of competitors makes it relatively more important. But it is only another operating system.

What struck me as more interesting, however, was the notion that this may turn out to be the last such update. In future, change would be incremental rather than revolutionary. That is partly a reflection of the difficulty of making an all-at-once revision, witness the fact that this one has taken seven years to develop and is two years late. But is also a reflection of the truth, evident in the development of all new technologies. Eventually they reach a stage of sophistication from which further gains are less important than the leaps that initially established their significance.

The obvious parallel is the motor car. It took about 20 years for designs to settle down, but a petrol engine, most commonly with four cylinders coupled to a gearbox and a final drive unit, have been main elements of the global standard design for nearly a century. For most of the car's history, change has been incremental, not revolutionary. And so it will be from now on for basic computers.

Software will continue to advance, but the software will be attached to the new services rather than the machine with which we access those services. Computers will become better, of course, but the more important changes will be in the way they are used, how they will change the fabric of our lives.

Back to the motor parallel. The car itself has changed relatively little, but what has, however, been revolutionary has been the changes that it has made possible in the physical fabric our cities, in particular the out-of-town shopping centres and the suburban sprawl. So it will be with computers, and today is as good as any to try to sketch what some of those changes might be.

Start with work. We are beginning to see the end of the commute. All right, not the end; commuting is not going to disappear in our lifetimes but, rather, people over the next generation cutting down radically on the amount of regular commuting that they need to do.

The reason is simple. Hugely competent computers coupled with ever-more-sophisticated software enable many people who, at present, commute regularly to work far more, either from home or from a location near their home. You can already see this happening in two respects. On the one hand, some people in normal "office" jobs spend part of their time, perhaps a day a week, working from home. On the other, there are people who spend, say, 15 years of their working life commuting, then leave their full-time job to form a consultancy, again working, in part, from home.

But what is happening at the moment is based on clunky technology. There are concerns about security, and quite rightly so. And, of course, there are the intangible benefits that accrue from people being physically in the same place, the instant and unplanned exchange of information or of views.

The last benefit will remain but seamless, secure and virtually free telecommunications will eliminate the other advantages of the office culture. It is rational: telecommunications becomes cheaper and better every day, while commuting becomes more expensive and worse.

There are further drivers. These include the need to squeeze costs, the push to outsource, the growing availability of older, skilled workers and the shortage of younger ones. At any rate, the proportion of the workforce in the UK that can be classified as teleworkers has been rising by close to one per cent a year. That may not sound much for a year but over a generation, if it keeps up, it is huge. It is the same sort of order of magnitude as the annual shift in our food purchasing from high street specialist shops - grocers, butchers, bakers and so on - to the supermarkets.

Infinitely competent operating systems, still faster computers, new software and services, plus very cheap telecommunications will affect work patterns between countries as well as within them. Anyone who works principally on screen can, in theory at least, live anywhere. We have seen the drive this has given to offshoring; what we have yet to see much is the impact on people who choose to live in multiple jurisdictions.

Moving to Monaco and running the business from there is very much a minority sport and will remain so. But moving to the south of Spain is mass-market stuff, and if people can work effectively from there as well as play golf, expect many more to make the move. The better the technology, the easier it is to make the move.

But the real lesson from the application of all new technologies is that it is better to observe than predict. You look at what seems to be happening but has not yet come up on the general radar, rather than make grand prognostications that turn out to be wrong.

Viewed globally, the fact that there is a true global standard for computer operating systems is one of the continuing forces leveling the global playing field. As the prime operating system gets better, the field gets flatter. If India operated on a different set of computer standards, it would not be able to sustain the growth it has achieved.

I have just been looking at some new projections from Goldman Sachs that suggest the country's present growth spurt results from a surge in productivity, and that this can be sustained. Indeed, the Goldman Sachs team predicts that India, as well as China, will pass the US economy in size before 2050. It would be ironic were the software developed in the US to become one of the reasons why the States becomes only the third-largest economy in the world. By then, of course, Microsoft will probably no longer exist, retreating into obscurity, just as so many of the great commercial names of past generations have disappeared. Given its present dominance, not to mention the tough-minded approach it has to any potential competitors, many people will feel comforted by that.

Meanwhile, whether you love or hate the Windows line of products, you have to acknowledge that they have already changed the workplace, the home and, indeed, the world. Most of us would agree that they have changed things for the better. And whatever the long-term significance of Vista, the social consequences of those changes have hardly begun.