Everyone wants a ride on this bandwagon

No other new industry has gone through its early stages in quite the same way that multimedia has. In the first place, we all seem unusually confident about the destination. This is the delivery of fully interactive multimedia on to a screen in our homes, a new medium that combines all the attributes of its predecessors - text, sound, moving image - and adds interactivity, a new ingredient. Yet it will be as easy to use as a book or the radio.

This certainty about the end result is unusual; most new developments are the result of pioneers feeling their way, not being very sure about where they are going but determinedly pressing on, sustained by more or less blind faith.

Second, nearly every company that could play a role in the development is doing so. New industries are generally developed by a few brave visionaries working alone. Not this time. Hardware manufacturers, software producers, publishers, intellectual property owners - anybody with a relevant skill is participating.

It is as if every engineering business in western Europe and the United States had had a go at motor vehicle manufacture during the 1880s, as soon as the basic principles of the internal combustion engine had been enunciated, already understanding that the age of the automobile was nigh.

Third, the players with the greatest faith are found in the financial markets. Any company involved in developing multimedia which chooses to seek a stock-market quotation seems to be guaranteed a rapturous reception. A history of continuous losses does not seem to matter. Investors will value the shares at perhaps five to eight times annual sales compared with a long-term average for most companies in most industries of one to two times. There is no shortage of capital.

The phenomenon combines a spirit of adventure on the part of consumers with the mania of the gold rush, so far as businesses are concerned. Consumers are in a forgiving mood.

As an electronic publisher, I am glad to say that consumers become attached to their multimedia PCs and enjoy playing CD-Roms, accessing the Internet, visiting Web sites, even though all multimedia products at present have technical shortcomings.

As far as CD-Roms go, we have not yet reached the stage of "plug in and play". With the Internet, the chances of accessing a chosen site quickly depends upon what time of the day it is. Once North American users get going during the day, the speed of the Net declines markedly.

But the users put up with this, as they did with jerky, soundless films in the early days of the cinema or with crackle and hiss when the first radio sets became available. They can sense what is authentic, work within the technical limits of the medium and have a lively expectation of continuous improvement.

I share this. When somebody told me the other day that an enthusiast had put up an excellent JS Bach site, I couldn't wait to visit it. More recently, I have read about famous football club sites on the Web; I shall visit these, too. It's a sort of adventure.

The gold rush is following the classic pattern. It is not the diggers themselves who make the first money, but the manufacturers of picks and shovels. In other words, the early beneficiaries are companies providing the infrastructure - making PCs and electronic components, providing Internet access and producing software, like the companies which devise the so- called "web crawlers" which steer you round the system.

The gold itself will be a way of profitably publishing interactive multimedia on CD-Rom or on the Internet so that a brand is created. The key words here are "profit" and "brand". Before this can happen, some problems need to be solved. Publishers will gradually learn to work with the grain of the new medium and come to see that a successful multimedia product is as different from a book or TV documentary as the cinema is from the theatre or television from radio.

This can only happen as the result of ceaseless experimentation; lots of talented young people working for new media companies are doing just this. Music and popular science are subjects that are particularly well suited to interactive multimedia treatment.

At the same time, the commercial infrastructure must improve. The sales channels for multimedia products are nothing like as smooth running or varied as they are for books or records. Moreover, prices for CD-Roms remain high; and on the Internet financial transactions are only just becoming simple and safe.

Because these preliminary developments are still being worked through, profits are thin, and some big companies have recently reported large losses. One or two, such as HarperCollins in the US, are even withdrawing altogether.

Nonetheless, so many companies are pushing along with such vigour that it may not be long before new brand leaders emerge, as powerful in multimedia as Warner Brothers in the cinema, or the BBC in radio and TV, or Penguin Books in publishing. This is the stage we have reached - waiting for brand leaders to emerge.

Andreas Whittam Smith was founder editor of the `Independent' and now runs the Notting Hill CD-Rom company.