The Future Trends Newsletter – July 2006

July 2006 © by Brian Morgan / Digital Products LLC Contents of this edition: 1. More on Hybrid Cars and Indiana 2. The Iraqi War 3. The Iran War 4. USA Internet Stats & Broadband Usage 5. Grocery News 6. The Top ISP’s for USA 7. Future Trends; Brian’s Insights

1. More on Hybrid Cars and Indiana
Indianapolis’ Allison Transmission (GM) deployed a hybrid by adding an electric engine to a traditional diesel engine. This hybrid engine reduces emissions, increases fuel efficiency, and provides better acceleration. Also this engine is a perfect fit for the Indianapolis buses; the new system reduces particulates up to 90%, increases acceleration 50%, and operates quieter and uses less fuel. If the USA had 1000 of these hybrid buses the gasoline savings would be 1.5 million gallons per year. The number of buses scheduled for delivery this year is 236 – currently there are 436 vehicles in 36 states using the technology. In addition, GM is collaborating with Daimler-Chrysler and BMW to produce a two-mode hybrid system that will be used in the 2007 Chevy Tahoe and the GMC Yukon full-sized SUVs, followed by the Cadillac Escalade in 2008. Toyota has made a $230 million dollar investment in the Subaru of Indiana Automobile plant (Lafayette) to build 100,000 Camry vehicles per year. This project will start in 2007 and create 1000 new jobs. This additional Toyota production will replace the imports from Japan (of the Camry). Currently there are no other plans to build additional hybrid autos in Indiana; yet Toyota does build a hybrid Camry in Kentucky. In 2005 America bought up 200,000 hybrid autos- which is double the number from 2004. Toyota had 6.6% of its sales in April being hybrids, and they (Toyota) are leading the industry in hybrid sales. Toyota is soon to offer an aggressive goal having hybrid models for all their cars, trucks, and vehicles. To counteract this Toyota venture, GM is partnering with Daimler-Chrysler and BMW to form what they are calling a Global Hybrid Cooperation – which will produce a hybrid system for all three auto makers. Right now a hybrid generally runs about $3000 more than a regular standard automobile. The auto industry is really moving at a fast pace to create and sell consumers a hybrid-drive car within the next 10 years. The other “type” of car being developed is the hydrogen model vehicle.

Don’t expect a large number of hydrogen vehicles anytime before 2015. The trends forecasters are saying that it will take the auto industry 10 years to implement and create new engine designs before they are fully accepted and available. 2005-2015 will be the decade of the Gasoline-Hybrid 2015-2025 will be the decade of the Hydrogen-Hybrid 2025-2035 will be the decade of the Hydrogen Car (The End of Oil) Shell Oil Company has stated that by 2025 it will sell more hydrogen than oil. Hydrogen burns much cleaner and is the most abundant element known in the universe. Sources: Inspire.net, author Erik Hromadka for Indiana Business Magazine May 2006. Sources: Inspire.net, author Stuart Brown, Fortune Magazine May 2006. Sources: Inspire.net, author Professor Jim Wolter, Grand Rapids Business Journal, February 2006.

2. The Iraqi War
If a war can be won by the dauntless spirit of the President, then perhaps the Iraqi misadventure may succeed. Iraqis are losing faith in their own government and in the US’ ability to improve it. Global terrorism has mushroomed since the war in Iraq began. According to a poll- 10 of 14 countries say the Iraq War has made the world more dangerous (due to increasing terrorism). It has been 3 years and 2500 deaths and the House (Congress) has started its debate- Republicans supporting the President’s cause for war and the Democrats calling for a change and to bring the troops home finally. Democrats claim that the President shot into this war without a plan and has made many mistakes along the way. Senator John Kerry (Dem.) offered an amendment to call for a withdrawal of combat troops by the end of 2006- the amendment was defeated 93 to 6. The Republicans say they stand against terrorism and they support our troops, while the Democrats question the President’s (administrations) competence. Clearly the Democrats want us to leave war-torn Iraq so they can solve their own problems. Republicans on the other hand link every terrorism event to the eventual “war on terror” – the war in Iraq. Source: Inspire.net, author Chicago Tribune, June 15, 2006. Source: Inspire.net, author Sun-Sentinel (Fort Lauderdale) June 15, 2006.

3. The Iran War
Even though it seems the US is torn in debate over the Iraqi War- it appears that the administration (Bush) is building up to bomb Iran. Progressive experts who follow US Security issues are increasingly certain Bush will go forward with plans to bomb Iran. One expert, M. Klare (Hampshire College), believes there is a 75% chance that Bush will bomb Iran before the 2006 elections.

The Bush Administration has been on a secret mission finding 3 dozen or more targets for destruction by precision strikes. Many feel the administration has been building up to a coordinated campaign to prepare for a strike on Iran. Reports published by the Bush Administration (New Security Strategy) state: “We may face no greater challenge from a single country than from Iran” and “they are an enemy of freedom.” Iranian Ayatollah, Ali Khamenei has said his country will “stand like steel” against any threat from the U.N. or Washington. The Iranian President Ahmadinejad doesn’t want his civilization destroyed – and know that it would be if they used nuclear weapons. Iran is not likely to hand over weapons to terrorists- knowing that it would lead to its own destruction. The Oxford Research Group states that any attack on Iran would further increase their desire to obtain nuclear weapons and protection – a nuclear armed Iran for decades to come. Bush will feel like a failure if he can’t stop Iran from developing nuclear arms, not only in his own eyes, but in God’s eyes, because he thinks he’s doing God’s work. Hillary Clinton declared that Bush was not aggressive enough toward Iran (January 2006). It is up to the US citizens to non-violently restrain Bush and his lawless, reckless, desire for war. Source: Inspire.net, author Matthew Rothschild, The Progressive Magazine, May 2006.

4. USA Internet Stats & Broadband Usage
In the first quarter of 2006 the US Dept. of Commerce reported the total US (non-travel) online spending was at $24.5 billion. A quarter being 3 months- that equates to 272.2 million dollars per day. Online sales are going to reach $211 billion in 2006, with per supplies and cosmetics experiencing leading growth. Excluding travel, 2006 internet sales are expected to increase 22% to about $138 billion. The largest non-travel categories are: computer software and hardware at $16.8 billion, automobiles at $15.9 billion, with apparel-accessoriesfootwear right at $13.8 billion. 54% of US shoppers say the internet is the most trusted shopping information source. More than 2/3 of online shoppers still make the bulk of their purchases at physical retail stores. Yet 62% use a combination of online and offline sources to gather information before they buy. 38% of US consumers still want to be able to see and touch products they buy. In the first quarter of 2006, China added 3.7 million new broadband subscribers, the USA added 3.3 million subscribers. The Asia-Pacific region still

claims the largest share of broadband lines, at 40% of the world’s 229 million broadband lines. Broadband subscriptions are posed to double by 2010; to have a total of nearly 400 million subscribers. In 2005 broadband finally surpassed narrowband as the primary method of online households to connect to the internet. Source: Inspire.net, author ZDNET Research Blogs online.

5. Grocery News & Employment News
Grocery: You know those grocery self check-out lanes? Well, in 2005 US consumers spent $475 billion at self check-out lanes. They project that self check-out lanes will nearly be doing $1.2 trillion dollars by 2009. Employment: 50% of employees aged 18 to 24 do not plan to stay with their current companies. Also in 2005 39% of the employees aged 25- 29 reported having neutral or negative attitudes about their employer and did not plan to stay long. Source: Blogs at ZD.net

6. The Top ISP’s for USA, and Top Websites
Here are the top ISPs in the 1st Quarter of 2006: Cable Size Comcast 8.957million Time Warner 5.168 Charter 2.322 Adelphia 1.808 Cablevision 1.806 Insight 514K Mediacom 504K Cable One 253K Others 4.19million Total Cable= 25.72 million DSL AT&T Verizon Bell South Qwest Sprint Covad Alltel Century Tel Cincinnati Bell Total DSL = Size 7.43 million 5.7 3.2 1.678 777K 557K 441K 285.7K 171K 20.17 million

Source: Blogs at ZD.net, Leichtman Research Group.

7. Future Trends; Brian’s Insights
More on Hybrid Cars and Indiana: The future trend that I predict is that both flexible fuel vehicles (FFV) and gasoline-hybrids will have to be available in just about every model of automobile- car, van, SUV, and truck. For automobile manufacturers to compete with Toyota, this will have to happen; Toyota is promising a hybrid engine for every model of vehicle they make. This is the reason the GM, Daimler-Chrysler and BMW are forming alliances to create hybrid engines – to stay competitive with Toyota. Also I predict even more

domestic sales increases for Toyota Automobile Company due to their announcement of creating 100,000 Toyota Camry models in Lafayette Indiana. With the Camry soon to be 100% US made, I predict the Camry sales will increase dramatically- it has been a “best selling” model for many years, and since it will be American Made I do think many more Americans will consider it as a domestic option. As mentioned above in the first article- the automobile industry will create these upcoming new engines in three phases so that they won’t have to change their factory tooling (equipment) overnight – the phases will be: the gasoline-hybrid engine, then the hydrogen-hybrid engine, then the hydrogen engine. And the future trend for ethanol I believe is that it will become readily available thanks to numerous ethanol plants around the country- it may not be cheaper than gasoline, but I expect that the government will require many more domestic filling stations to offer ethanol and they will also provide media coverage concerning the benefits of using ethanol instead of using 100% gasoline. The reasons are simple- domestic ethanol is 100% American Made, so if you purchase ethanol you are supporting American workers and companies rather than supporting oil foreign workers and companies. I don’t predict the ethanol price to be America’s motive for purchasing it, their motive and intention will be due to its (ethanol’s) domestic manufacturing and creation. The Iraqi War: The Iran War: The future trends for these two countries is that they either become democratic, give up large scale weapon manufacturing (esp. nuclear) or they’ll face increasing potential of American Occupation and American Force (warfare). There is much money to be made in wars, in fact I did some interesting reading and research into a firm called the Carlyle Group. They are an interesting organization that employs many politicians in it’s membership ranks- supposedly the firm has politicians write the laws for doing business with government contractors while they work for the US government- and it just so happens these same politicians have ties to the Carlyle Group which is heavily invested in government contract work. Guess who gets many government contracts? The Carlyle Group’s network of businesses that they invest in and consult with. Surprised? USA Internet Stats & Broadband Usage: There are many things happening online that many businesses don’t really know about, because their business is mainly offline. My future trends prediction is that many new internet firms will start taking business away from local small businesses (like professional services industries). One good example that I hear a lot about through their advertising is Geico, Progressive, and esurance. These are internet car insurance companies- ten years ago they did not exist. Guess how many customers they have total? Geico has roughly 6 million auto policy holders. Progressive has roughly 9.83 million auto policy holders, and 502,000 commercial policy holders. Esurance states on their website that they have 500,000 clients.

So about 17 million policy holders for three Insurance Internet Companies. What industries do I see following suit to join the Internet eBusiness model: mortgage firms, car loans, banks (savings, investments, billpayment). Grocery News: For grocers the future trend I see is to help communities save money. They can do this by organizing online buying groups that all desire to save money on their groceries (any product) by placing a “bulk order”. I recently read about a Chinese group of people doing this right before visiting a store, they all arrived at a pre-determined time and had a list of demands for the retailer, so that they could get larger discounts as a group, and from the news report the retailer did give them their discounted goods. I have talked a lot about this in past articles and I call this “consumer buying networks” or CBNs. This is simply an online community that decides to join hands and negotiate with a retailer, wholesaler, or perhaps a manufacturer – and the main intention is to increase the volume through online network building and therefore decrease the overall products price due to leveraged bulk purchasing. If there was an online firm that only sold to online networks; this online merchant would not have to store the merchandise like a WalMart or Meijers. The online merchant would be able to work with a large CBN (community buying network) of say 1000 ( or 100,000) people and then place a 1000 quantity order for an entire group of products. This bulk purchasing might make “having stock on hand” a detrimental thing for retailers that are in competition with online retailing negotiators- or let’s call them CBN Merchants. This is a very real venture that I see coming in the very near future, just hope that I am a part of the team that does this. The Top ISP’s for USA: The future trends for America’s Internet is Broadband Computer Service at lower prices. I could probably find some type of wireless internet connection devise to run at my home- and in doing this provide Broadband Internet for my close neighbors- that is free internet access. It’s probably illegal, but I can see that it would be possible to implement something like that. I see more ISPs offering cable-broadband at cheaper prices- I pay $40 per month, and I believe that I should be paying something closer to $25 per month. As broadband services start to replace dial-up in developed countriesmore entertainment will be available, and as I predict the computer will have to easily connect to the television making it easy for anyone to watch video content from their ISP on their TV. The future trend- a very simple connection (wire or wireless) so that broadband clients can use their TV’s for video internet content. Thanks for reading this issue of The Future Trends. The online version can be found at www.esnips.com , search for these tags: Brian Morgan The Future Trends. You can email me: B-Morgan@Earthlink.net

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