In the share market every day, we ask ourselves the question ‘where will growth come from?’

‘Invest in companies that humans rely on for their existence’ has been our mantra for as long as we can remember, but who are these companies and how do we identify them in times such as these?

At the moment, it seems that the Australian stock market just keeps slip sliding away and as we wrote in a previous note, apathy abounds.

Australians are saving more and spending less (a good thing) and it seems that right now the only areas of growth are food, coffee, technology and energy.

There is, however, still growth around, and one particular area continues to be the technology sector. Earlier this week, Cisco released another paper detailing growth on the internet and it makes startling reading when we consider how patchy our economy has become.

Cisco predicts that video traffic, which includes high-definition TV over the internet will increase 14-fold between 2010 and 2015.

They predict that global mobile internet data traffic will increase 26-fold from 2010 to 2015.

Business video conferencing is projected to grow six-fold over the same period.

Consider the implications for companies such as Telstra, Qantas, NextDC, the traditional and the online retailers, property and housing companies to name a few.

Apple’s share price in the US has been one of the stellar performers over recent times and last week the kings of creative destruction yet again threw open the gates.

In order to stay relevant and ahead of the game, Apple have decided to, in effect take the risk of blowing their existing business to bits.

Apple’s recent announcements about their updated operating system and their new cloud storage, syncing, and media service can all be viewed as increasing ease of use. But from the perspective of Apple CEO Steve Jobs they perform an even more vital function – killing Microsoft.

Bob Cringley of Cringley.com neatly summed up the Apple game plan in a recent blog following Apple’s announcements. As Bob puts it:

Here is the money line from Jobs: “We’re going to demote the PC and the Mac to just be a device – just like an iPad, an iPhone or an iPod Touch. We’re going to move the hub of your digital life to the cloud.”

Just like they used to say at Sun Microsystems, the network is the computer. Or we could go even further and say our data is the computer.

This redefines digital incumbency. The incumbent platform today is Windows because it is in Windows machines that nearly all of our data and our ability to use that data have been trapped. But the Apple announcement changes all that. Suddenly the competition isn’t about platforms at all, but about data, with that data being crunched on a variety of platforms through the use of cheap downloaded apps.

What this requires from Apple is a bold move that Microsoft would never make: Jobs is going to sacrifice the Macintosh in order to kill Windows. He isn’t beating Windows; he’s making Windows inconsequential.

Having been shown the way by Apple, I expect Google to shortly do the same thing, adding automated backup, synchronisation and migration to Android and Chrome.

Both companies will be grabbing for data, claiming territory, and leaving Microsoft alone to defend a desktop that will soon cease to exist.

And what happens once all our data is in that iCloud, is there any easy way to get it back out? Nope. It’s in there forever and we are captive customers — trapped more completely than Microsoft ever imagined.

Apple and Google will compete like crazy for our data because once they have it we’ll be their customers forever.

This transition will take at most two hardware generations and we’re talking mobile generations, which means three years total.

With no mobile market share to speak of and Windows 8 not due until 2013, Microsoft is likely to be too late to the party, with much of Redmond’s market cap transplanted eventually to Apple and Google.

Some will say this is unlikely because of Microsoft’s grip on enterprise sales, but consumers have been leading the IT market for the last decade and the mobile transition will only accelerate this trend.

The quicker Microsoft can turn itself into IBM the better for Redmond, because that appears to be their only chance.