Information technology vs industrial cluster formation Essay

Information technology vs industrial cluster formation - Essay Example The very meaning of markets and boundaries defining the markets and business domains have undergone a complete change because of the internet and fostering technological change that it brought in its wake. While corporate business world has taken full advantage of the internet, it has still I the early phases of realizing full support and potential of the internet. IT speculators suggested huge benefits from the internet which meant relocation and complete physical freedom from the customers, competitors and physical boundaries of the market which earlier defined the very limits of any industry. By early twentieth century, the markets were tended to be defined at local level, at city level and at the national levels. There was little mention of the international or global markets. This was because of limited progress achieved in the means of communications and transportations. Most markets were considered as physical definitions or definitions in terms of physical presence of the buy ers and sellers. Each place where buyers and sellers could be physically present were defined as local markets. Where ever the buyers and sellers could gather together from a national scale were the national markets. The limited advancements in the means of transport and communications were a natural barrier on the market definition. Discussion: As the industrialization process grew and the means of transport and communications also grew with them. The beginning of the railways system and the telegraphs and telephone brought about some relaxations in the definition of the markets and the markets definitions also included the areas from far off here there were customers of any product or service where transport means such as railways and communication means such as telephone and telegraphs had access. Therefore the means of transport and communications have served as a key factor defining the geographical boundaries of markets. The definitions of the market boundaries has moved hand in hand with the advancements of the transportation and communications. The second half of the twentieth century has brought a technological revolution especially in the IT sector. The computer is the most fascinating invention of the twentieth century. It has transformed the speed and accuracy levels of the information processing. It has also promised and delivered transparency and merit. In the last fifty or sixty years the world has witnessed the rise of internet which has impacted the communications in an un-precedent manner. The rise of the internet has defined and redefined the basics of communications in every nook and corner of the world. The business markets and each industry and segment is deeply affected by the growth and usefulness of internet. Amongst the key benefits envisaged by the IT experts, the Internet was thought to redefine the markets as well. In several sectors such as services banking and retailing and IT, it was thought that the internet would introduce bra nchless services virtually eliminating the physical presence of the branches in every area of the country. But despite the wide spread use of the internet in every office and production factories and manufacturing area, it is noted that companies still prefer to be located near their competitors and outsourcers. Why? This is the primary question that we need to answer in this essay. In the