Uncommon Wisdom

Nov 20 2007   3:33PM GMT

Internet traffic growth could be $150 billion problem



Posted by: Tom Nolle
Tags:
Internet
Video Adapter

A study predicts that the unbridled downloading of content will increase Internet and broadband access traffic to the point where serious slowdowns could occur by 2010, and an investment of nearly $150B would be required to fix the problem. The exact numbers and dates here may require some justification, but the overall problem cited is real. The challenge with the current Internet model is that there is no financial back-pressure against multiplying traffic, which also means that there is no incremental revenue associated with that traffic. The pure over-the-top model risks a separation of “return” from “investment” and that means that even if these numbers are true there may be little or no incentive for the operators to spend the kind of dollars suggested. The suggestion that “something must be done” may be valid, but there has to be a commercial framework created that permits investment or nothing will be done.

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  • Jacomo
    I agree with Mr. Nolle, without financial rewards there is little incentive to build out these backbones. However, If one looks at how Google is positioning itself Nationwide US (today-World near term) with their data Centers interconnected by fiber and managed end to end with low latency & QoS, one sees a subsitute for much high volume Broabdnad traffic that will be routed over their backbone to their in house Content/Hosting Applications etc. All they are missing YTD, is access to the Last Mile Pipes, which they will address either with their 700Mhz Bid (assuming they win a nationwide license) or via a simple Fiber Link to most service providers as a replacement for or complemment to their Dual Home Internet (Tier#1) links. WIth Ad revenue share and very high quality Broadband links to Google based and other Worldwide Content/Apps, they will eventually dominate much of the Web activity. As a Service Provider we'd welcome an opprtunity to work with Google and provide (at our cost) a dedicated Fiber Link to their local Data Centers and allow them access to our local customer base with premium level Services. Jacomo
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