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Technology Stocks : Newbridge Networks
NN 15.87+2.5%Dec 5 9:30 AM EST

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To: pat mudge who wrote (3739)3/18/1998 12:15:00 AM
From: Tunica Albuginea   of 18016
 
Pat, Mark, all; Re: this article on Internet explosion.
I think I can see the implications for NN but perhaps somebody else can comment:

techweb.com

Internet Demand Is Moving Faster Than Technology, Panel Says
(03/16/98; 3:13 p.m. EST)
By Jeff Sweat, InformationWeek Internet bandwidth demands, fueled by technology such as video and IP telephony, are rising so rapidly that backbone providers may not be able to keep up, a panel of ISPs and equipment vendors said Friday at Spring Internet World '98 in Los Angeles.
The panelists, speaking at a keynote session, said Internet use is shooting up more rapidly than expected. According to Alan Taffel, vice president of marketing and business development at Fairfax, Va.-based ISP Uunet Technologies, the Internet used to double in size once a year, but now it's doubling every three to six months -- a tenfold increase per year. "We have to radically alter our backbone very, very regularly," he said. "We and everybody else are going to have a difficult time keeping up with bandwidth demand."
Other panelists concurred, saying building up a backbone is made more difficult because ISPs and network equipment providers have to see what uses emerge for the Internet. "We're being asked to build bandwidth for the future without really knowing what the traffic will be," said David Garrison, chairman of ISP Netcom On-Line Communications Services, in San Jose, Calif.
And new applications such as video have significant impact on existing infrastructure. "As new applications come along, it [the Internet] is gonna break. So we scramble like crazy to try to fix it," said Jeanette Symons, founder and chief technology officer of Ascend Communications, in Alameda, Calif.
Internet users have come to expect that Internet services are "free" after the user has paid infrastructure costs, but the panelists said the business model won't hold up as specialized services such as IP telephony put extra demand on the network. "Eventually, people will have to pay," Symons said. "If they're investing in their infrastructure, the money for that has to come from somewhere." What still has to be determined is whether users have to pay for the service, for time, or for distance.
The ISPs on the panel said the cost of building a "long-haul" nationwide backbone, as opposed to short- distance segments, is so high that providers may be forced to move to a telephone company-inspired distance pricing system. "Distance-sensitive pricing may reemerge," Uunet's Taffel said.

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