Lee S. Isgur is a visionary whose visions have a habit of coming true. In the 1970s he was far ahead of the crowd in forecasting the subsequent explosions in films, gambling and video games. Now, looking into an array of new entertainment technology heading our way in this decade, Isgur is convinced that we ain't seen nothin' yet.
Try this for size:If you don't think Michael Keaton should have all the fun with Michelle Pfeiffer, send a message from your computer to your television set replacing his face with yours - and, throughout the videotape, see yourself as Batman.
Or this:
Instead of having to choose between portability and quality, you'll be offered a dazzling selection of hand-held "multimedia platforms" whose graphic displays will approximate movie-house motion and definition.
Or this:
A society condemned in the late 20th century as a passive consumer of too much technology may find in the 21st century that most software will be used almost entirely in an interactive way, converting the user's input into a meaningful and entertaining experience.
Isgur, a veteran entertainment-industry analyst now with San Francisco's Volpe, Welty & Co., tells me he is convinced the future will belong not to the manufacturers who produce the world's hardware but to those whose product may be less tangible: the software industry.
As he puts it, "This is the beginning of the age where the former disparate worlds of the poet and the engineer will merge."
Only 20 years ago, he notes, companies like Matsushita and General Motors were regarded as leading concentrations of corporate wealth, while businesses like Disney and what is now Time Warner were relatively small and had little influence. Today the latter are emerging as worldwide corporate leaders with impressive revenue and cash flow, while traditional manufacturers like Sony and Matsushita have been scrambling to buy software producers like CBS Records, Columbia/TriStar Pictures and MCA.
Those trying to predict the future of technology in this field find their predictions continually being eclipsed. One important reason: The price of computer memory, which is key to such development, in recent years has been tumbling at a compound rate in excess of 60 percent annually. Gordon Moore, one of the founders of Intel, theorizes that the amount of memory a dollar will buy should double every 18 months. Result: What seems fantastic and impractical today soon becomes yesterday's news.
From an investor's point of view, Isgur believes the easiest way to take advantage of the coming expolsion in interactive entertainment software is to buy shares of the world's largest software company, Time Warner. This giant, he's convinced, "should be an important beneficiary."
But there will be no monopoly in this era of ideas and imagination. By the turn of the century, Isgur expects at least half the world's largest corporations to have "a major exposure" in entertainment software. Within the next 20 years, he thinks at least 40 percent of consumer entertainment software expenditures will be on the "interactive" variety that responds to user input. And with this perceived bonanza ever more clearly in sight, he predicts that five of the 10 largest interactive software companies will be taken over by bigger corporations "at a multiple of their current market capitalization" within the next two to five years.
One of his current favorites is Electronic Arts, "the leading software company in terms of technology."
Caveat emptor, in the realm of investments, where prospects can change faster than technology.