SCHINDLER: Give us your background. What qualifies you to separate the wheat from the chaff?
TCHONG: I have been involved in the advertising business for nine years. I've had two publishing start-ups, including MacWeek, for which I'm best known. I've also worked on the software side. I've been involved in one of the first desktop publishing programs called Ready Set Go, and also having had my own software start-up company called Atelier Systems. I have sold another website to I-Pro called Cyber Atlas, and I just recently sold Iconocast to Imagine Media, so I've done quite of bit of entrepreneuring in the high-tech community, and I've seen it from all sides -- client, agencies, as well as publishers -- and I bring that perspective to the marketplace.

SCHINDLER: Michael, when I started covering the Internet about three years ago, the big promise in Internet marketing was one-on-one relationships, being able to segment the market down to that single individual and what that single individual wants. Is that going to happen?
TCHONG: Oh, it's already happened. There are two ways of doing this. One is collaborative or learning systems that you can use from people like Net Perceptions and Likeminds.

The other one is what I call the ad hoc and on-the-fly targeting of users based on their visit patterns. The most prominent example of that is a company called Aptex based in San Diego, and they use techniques that they borrowed from the credit-card processing industries where they, and as you well know, they're quite effective, the minute you start spending a little bit too much in Paris they call you on the phone right away. Those type of pattern recognitions are applied in e-commerce or in advertising to customize content as well as the banners that are shown to the people that visit. C O N T I N U E D . . . 2 of 2
SCHINDLER: So how does the burgeoning privacy movement on the Internet, how is it going to affect that -- because people don't want their clickstreams followed, they don't want cookies, they're very scared about having all that information.
TCHONG: There's two issues there. I think that one, the media of course tends to bring up all of the negatives of this, but the reality is that consumers do want information that they are interested in and I think that if you were to relieve them of bandwidth congestion by giving them only advertising and promotional literature that they are in need of at the point in time that they are buying, I think you're doing them a service.

Of course there are elements in the business that are misappropriating data and doing things they shouldn't be doing, i.e. spammers and the like, but you know, you have those in every business and I think that as people start to recognize what they can get through registration and people like eTrust start to certify a heck of a lot more sites than seven, I think you'll see a big thing happen.

SCHINDLER: You mentioned spam. It's a hot topic on the Internet. There have been a number of solutions proposed. Do you like any of them?
TCHONG: Well, I think that the best chance of regulating it is the Netizen's Protection Act that is right now winding its way through Congress. There is a similar act in California that's being sponsored by Republican Brian Adams from Diamond Bar, southern California, right here. I think they are extending the Fax Protection Act, as it's called, which prevents you from receiving junk faxes and would limit e-mail the same way. And I think that's probably our best guess, in addition to all the lawsuits that are being won by AOL right now, and people like Juno. So that's another way to go.

You also asked earlier about the e-commerce forecast. I wanted to just interject the gentlemen over here didn't know what it was, but the combined e-commerce sales last year on the Net was $8.2 billion, and that is a lot of money. $6.6 billion, if I recall correctly, was business-to-business, and about $1.4 [billion] was consumer, or 6 or 8 I guess. The consumer market is going to go to somewhere around $32 billion in about five years, and the business-to-business market is going to go in excess of $300 billion easy, Forrester says as high as $330.

To give you an idea of the $6.6, $6.8 in business-to-business consumer sales we did last year, Cisco did $1.8 billion all by itself. Dell is technically also considered to be in the business-to-business arena, although they sell to consumers, and they did $1 billion. So those two people by themselves did $2.8 or 50 percent of e-commerce. That's not going to stay the same for a long time, of course.

SCHINDLER: So those are both computer companies, though. What's going to be the forecast for general goods and services?
TCHONG: The consumer forecast that I was mentioning, the $1.4 billion, was done by people like, the leading consumer people are Amazon.com, PC Flowers, CD Now, Music Boulevard.com, and these people are doing in the neighborhood of about $50 million. You know, $100 million and less. Amazon did $125 [million].