Here's a good article about the internet. With all the bandwidth that is coming about, there is going to be a natural increase in "data" (information) that is available. Kinda like going to the old newstand/library/bookstore; there is so much to read, that you have to be selective in your choices. Guess what Newsedge does?
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10/07/98- Updated 09:27 PM ET
The Nation's Homepage
Communications industry booming
Technology could cut long-distance cost to 1-cent per minute
If you've been awed by the way computing power keeps rocketing toward the heavens, wait until you see what's about to happen to communications power.
People in the industry call it a bandwidth explosion. A stampede of new data communications networks that have astounding capabilities will be turned on over the next four years. The pace of improvements in communications power will make computers look like donkeys on a towpath.
Four companies - Qwest, Level 3, ITXC and Williams Communications - are building the equivalent of 80 AT&Ts in the USA, according to North River Ventures. All their networks could carry Internet, voice or TV traffic. On top of that, AT&T, WorldCom and Sprint have begun work recently on new data networks, and technological advances are boosting the capabilities of the networks by the day. In 1985, it took six fibers in a fiber-optic line to carry a single TV broadcast of a football game, says Howard Janzen, CEO of Williams. Today, one fiber could handle 700 such broadcasts.
The bandwidth explosion will send shrapnel flying everywhere. It could drive the cost of a long-distance phone call to 1 cent a minute within a year, analysts say. Soon after, it should make full-fledged TV over the Internet possible, deconstructing the very identity of a TV channel. The bandwidth boom is already sucking life out of the consumer personal computer software industry: Investment and talent are flying out of software and into Internet applications, says Netscape Communications co-founder Mark Andreessen.
''Bandwidth is the drug of the day,'' says Dave House, president of Nortel. ''Processor power (in computers) used to be the drug of the day.''
One nagging question is whether the boom will be too much bandwidth too soon, flooding the market before users need it, want it or can get it through comparatively slow connections going to most homes and small businesses. Those building the networks argue that there can never be too much bandwidth. Like new asphalt highways in busy suburbs, as soon as more bandwidth is built, people find new uses for it and it fills up.
The other side, though, warns of a coming shakeout. ''If suddenly huge capacity comes on line, there's going to be a bloodbath'' because the ratio of price to performance ''is going to go through the floor,'' says Francis McInerney of North River Ventures. That scenario could mean vicious price wars that might collapse long-distance phone rates to almost nothing and lead to a new round of communications mergers that trump even megamergers such as Bell Atlantic and GTE.
Explosion of networks
Only a year ago, the bandwidth builders seemed a little nuts. Their concept was still fresh: create nationwide or worldwide networks based on the high speed and massive capacity of fiber optics and the flexibility of Internet-style, packet-switched technology. Such networks could carry hundreds or thousands of times more traffic than is carried by existing networks and handle e-mail, regular phone calls, Web pages, video and even high-definition television signals.
High-profile start-ups such as Level 3 and Qwest are betting more than $3 billion each on that future. Taking a different approach, Craig McCaw's Teledesic is building a $9 billion space-based network with similar capabilities. More recently, traditional phone companies jumped on the bandwagon. Sprint announced its ION network; AT&T its INC network.
All this capacity is scheduled to be turned on between now and 2002.
Why place such bets? ''It's not inconceivable that there will be a million-fold rise in Internet traffic by 2005,'' George Gilder, writer and bandwidth evangelist, told an audience at his September conference, Telecosm. ''There's just an awesome explosion of traffic, which means an awesome explosion of bandwidth.''
Another driving force is advances in communications technology. For 20 years computers have advanced to the beat of Moore's Law, which basically says that the power of a microprocessor can double every 18 months while the price stays the same. During the same 20 years, communications technology has been slow to change. No longer.
''We are freeing communications technology from the clutches of Moore's Law,'' says Mukesh Chatter, CEO of Nexabit Networks.
Out of the blue, Nexabit came up with terabit switch technology that can manage traffic on a network 100 times faster than current products on the market. In August, Nexabit picked up a $20 million investment from Vulcan Ventures, which is controlled by Microsoft co-founder Paul Allen. Now Nexabit is racing to beat Juniper Networks, another start-up that has a similar product. Juniper is backed by 3Com, AT&T, Lucent Technologies and Nortel.
Such advances mean that new networks can be far more efficient than older networks. So a Level 3 sees an opportunity to steal business from older networks because it can charge less and still make a profit. Owners of older networks, such as AT&T and Sprint, realized they have to build newer networks to stay competitive with the upstarts. The cycle leads to the explosion of bandwidth.
But all this new capacity brings with it a couple of problems.
Too much or too little
Problem one is sometimes known as the last-mile bottleneck. The major advances and investments have almost all been made in backbone networks - networks that carry traffic around cities, around the country or around the world. Almost all homes and small businesses are connected to those backbones by phone lines, which can handle just a trickle of data. It's as if the backbones are 32-lane mega-highways packed with cars, and nearly all the exit ramps are sidewalks.
Big corporations can afford better connections to the backbone. But corporations can't provide enough traffic to keep all the new capacity busy. To fill the backbones, homes and small businesses will have to have big, fast connections, too. That will come from cable modems and high-speed phone lines, but both are only now rolling out. ''For three to five years, we're going to be stuck with what we've got'' in terms of bandwidth connecting homes to backbones, says Armando Garcia, vice president of Internet media at IBM.
If homes and small businesses end up stuck with their sidewalk-size connections for too long, the communications companies could end up with a severe oversupply of capacity - a disaster for those companies. The companies, though, say that the capabilities their networks give the Internet will be so enticing, consumers will demand better connections and drive the companies that can supply them to move more quickly.
''Are we building too much network?'' asks Williams' Janzen. After talking with Microsoft and others to gauge consumer interest, he says, ''All the bandwidth being deployed won't even come close.''
Others aren't so sure. ''They've built it, and they're hoping like hell people will come,'' says Mark Bruneau of Renaissance Worldwide.
The message is the medium
That brings up problem two. Some say that all the new bandwidth is a new medium, like television in its early days. To drive use of the medium, someone has to come up with a new kind of entertainment or information content that pulls people to that medium. But that doesn't seem to be happening yet. It's a chicken-and-egg problem. Like IBM's Garcia, content people won't aim for the new medium until it's widely available; but it might not be widely available until new content gives people a reason to demand it.
''There is a vacuum (bandwidth builders) hope will be filled by applications developers,'' Bruneau says. ''Someone has to take the lead.''
In the PC, as Intel made faster microprocessors, Microsoft worked in partnership to create software that would use that new capacity and give people reason to demand the latest PC. No hand-in-glove partnership like that is coming together in the high-bandwidth world.
Yet the question is more ''when'' than ''if'' content will catch up with the networks' capacity. America Online has launched a unit to develop high-bandwidth content. Road Runner and @Home, the cable modem companies, are searching for content that will drive use of their products.
It could be that none have to look as far as they might think.
''I don't think applications are a big deal - it's straight TV,'' says researcher McInerney. Broadband Internet could carry TV signals to PCs or TV sets. Consumers could grab video from all over the world, just as they now get Web pages from anywhere. They could pluck individual shows off souped-up video Web sites. TV would never be the same. ''We'll broadcast off our camcorders. When you combine television with interactivity, you get a new medium,'' McInerney says. That might drive enough demand for the new communications networks.
Triumph or train wreck?
If the twin problems get solved within these next four years, the effects could be phenomenal.
The cost of communications would dive while capabilities soar, just as has happened with computing. Video phones and video e-mail could quickly catch on in mass markets, analysts say. Entertainment would become on-demand and interactive. Telecommuting would be easier since computer connections from home could rival those in the office. Consumers and businesses would flock to the Net like never before.
The communications companies would fill their networks to overflowing. Their big bets would prove right. Founders of the start-ups - Level 3's James Crowe and Teledesic's McCaw - would become super-billionaires.
If the problems don't get solved, expect a train wreck. Oversupply would kill many of the start-ups amid ruinous price wars. The big players would merge to try to become more efficient and tighten up the market. The bright broadband future would be put on hold, angering eager consumers.
Either way, the bandwidth explosion should provide fireworks. ''We don't know what will happen. We've never seen something that grows 10 times a year compounded,'' says Eric Schmidt, CEO of Novell. ''This is the beginning of a very, very big thing.''
By Kevin Maney, USA TODAY
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