Web users' voracious appetites for YouTube videos, pirated music and movie downloads could have an unintended consequence: choked and slow Internet service for many small and medium-sized businesses in electrical distribution. Indeed, studies released by Nemertes Research (www.nemertes.com) and IDC Research (www.idc.com) indicate a slow-down could come in as little as two-to-five years.
“Today's broadband is tomorrow's traffic jam unless we continuously invest, innovate and improve our network's ability to handle the traffic,” says Bruce Mehlman, co-chairman of the Internet Innovation Alliance (www.internetinnovation.org).
Small and medium-sized electrical distributors are among the users most at risk, these researchers say, since many relatively modest users purchase Internet service over shared, lower-speed lines — much in the same way residential consumers purchase Internet service. Those lines, made of copper or coaxial cable, are simply not designed to accommodate the relentless demand for bandwidth-hogging applications being embraced virally across the Web, according to Nemertes' research.
Specifically, the Nemertes study released in November 2007 found that without an overhaul in new infrastructure investment, Internet access in North America will cease to be adequate for supporting demand within the next three-to-five years. And IDC's study, released this past June, revealed that 51 percent of telecommunications pros they surveyed are concerned that increasing bandwidth demand will “break” the Internet. Moreover, 43 percent of that group also believe 30 percent of all traffic on the Web today is video, and 40 percent expect that video will be hogging 75 percent of all traffic by 2013. “The findings of this survey make it very plain that bandwidth is not infinite,” says Lee Doyle, a group vice president at IDC.
Small- and medium-sized companies hardest hit would be those that rely on Web-based applications for internal operations, Web interfaces for customer/client transactions, connectivity to remote offices, and back-up services for precious data, to name a few. Many clients and customers of those businesses would also be negatively impacted. Web transactions that previously had gone through without a hitch could take longer on slowed lines, or not be completed at all. And someone clicking on a company Web video may have to endure an agonizing wait for the download.
The great promise of the mobile Web, accessed by mobile phones and other handheld devices, could also suffer mightily. IDC's survey found 50 percent of telco pros believe video is currently putting the biggest demand on mobile networks, and 81 percent believe the same condition will exist five years from now. A thwarted Internet could also severely threaten future Web innovations, adds Karen Wucher, a Nemertes spokesperson. Incredibly successful past innovators like MySpace, YouTube, Amazon.com and Google flourished in part because the Web was so accommodating. Future innovators might not enjoy the same success if the Web is moving at the speed of sludge.
But not all researchers are buying into the cries of gloom-and-doom. Andrew Odlyzko, a digital technology director at the University of Minnesota, says his research shows Internet growth is actually slowing, and that the supposed impending collapse of the Net is greatly exaggerated.
Nemertes' predictions are based on assumptions that Internet traffic growth will balloon 100 percent each year for the foreseeable future, Odlyzko says, something that is not borne out in his own studies, conducted under the auspices of the university's Minnesota Internet Traffic Studies (MINTS). “Right now, we are seeing growth of around 50 percent per year, and trending down, rather than up,” Odlyzko says. He also points to Hong Kong, a more mature Internet market where six times as many people per capita use the Web as those in the United States, as another indicator of slowing Net growth. In that region, MINTS figures show Net traffic is actually shrinking, down 20 percent in 2007. Jason Correia, director of marketing for Dreamco Design (www.dreamcodesign.com), a Web design firm, also believes fears about a Web slow-down are more of a Chicken Little, “the-sky-is-falling” rant than anything else.
The fact is that Web technologists are continuously finding ways to shrink data into ever smaller file sizes, enabling telcos to transmit more data through the same-sized pipe, Correia says. Today's .FLV video file, for example, takes up much less space in the pipe than older video files like .AVIs and .MPGs. “We anticipate this trend will continue, making data smaller and smaller as far as the numbers go while maintaining or even enhancing quality,” he adds.
Even so, key telecommunications players that have a great deal to lose if the Web slows to a crawl already appear to be hedging their bets and are implementing policies designed to limit the heaviest users of bandwidth. Comcast, for example, has placed an across-the-board, 250 gigabyte bandwidth cap on every residential customer it sells broadband to, effective last October. While typical Comcast customers will not be impacted by the cap, “bandwidth hogs” — people who spend hours on the Internet every day, downloading countless movies, endlessly watching YouTube videos and swapping hundreds of pirated songs — may feel the bite.
Meanwhile, Time Warner Cable has responded by experimenting with a metered billing structure for new customers in Beaumont, Texas. Under the plan, heavier users of the Net will pay more for service than others.
The take-away for small and medium-sized electrical distributors? Evaluate the kind of connection you're currently using to connect to the Internet, and be prepared to jump quickly to the next service level if service in your area begins to deteriorate, experts say. Businesses using a DSL or cable modems, for example, will want to upgrade to a dedicated, corporate T1 line if their current service gets sluggish. And those already on T1s should be considering DS3 and fiber connections. While you're making the upgrade, also attempt to get a service agreement with teeth — a contract that spells out in technical detail the kinds of speeds your provider will guarantee.
Those who think government can help may also want to get behind the Internet Innovation Alliance (IIA), which is pushing for tax breaks and telco business-friendly policies from Washington, which it believes will encourage technology providers to develop and invest in a more robust Internet infrastructure.
“How we use the Internet today is fundamentally different than it was even three years ago,” IAA's Mehlman says. “We need to take steps now to ensure continued improvement of the broadband infrastructure in North America meets the projected demand.”
IDC's Doyle agrees. “Unless there is sufficient investment in new infrastructure, the increased bandwidth demands of new advanced service could well outstrip capacity,” he says.
Not surprisingly, Minnesota's Odlyzko, who believes Internet slowdown fears are overblown, is skeptical. “As it is, telcos and cablecos have an incentive to bring fiber closer to the home and office anyway, as part of the ongoing maintenance/upgrade cycle,” Odlyzko says. “With current growth rates in traffic, I do not see any need for a major increase in the budget for such efforts.”
Joe Dysart writes frequently on Web topics. Over the last 20 years, his articles have been published in more than 40 publications, including The New York Times, Financial Times of London and the Silicon Valley Business Journal. As part of his consulting practice, he helps clients with website promotion. You can contact him by e-mail at: [email protected] or by phone at (646) 233-4089. His website is www.joedysart.com.