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Bandwidth Demands Exceeding Internet Infrastructure Investment

Irwin Lazar

Nemertes Research has released a report on the future of the Internet infrastructure. The key finding from the report is that bandwidth demands are exceeding infrastructure investment, especially at the access layer. We noted in the project that users may begin to see the impact of degraded application performance as early as 2010. We also noted that the planned investments in Internet infrastructure are insufficient to meet growing demand.

From the executive summary:

Our findings indicate that although core fiber and switching/routing resources will scale nicely to support virtually any conceivable user demand, Internet access infrastructure, specifically in North America, will likely cease to be adequate for supporting demand within the next three to five years. We estimate the financial investment required by access providers to "bridge the gap" between demand and capacity ranges from $42 billion to $55 billion, or roughly 60%-70% more than service providers currently plan to invest.

It's important to stress that failing to make that investment will not cause the Internet to collapse. Instead, the primary impact of the lack of investment will be to throttle innovation-both the technical innovation that leads to increasingly newer and better applications, and the business innovation that relies on those technical innovations and applications to generate value. The next Google, YouTube, or Amazon might not arise, not because of a lack of demand, but due to an inability to fulfill that demand. Rather like osteoporosis, the underinvestment in infrastructure will painlessly and invisibly leach competitiveness out of the economy.

The report is freely available for download (registration is required).

By Irwin Lazar, Analyst
Related topics: Access Providers, Broadband, Telecom
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Re: Bandwidth Demands Exceeding Internet Infrastructure Investment Fergie  –  Nov 20, 2007 12:31 PM PST

This Nemertes "research" is a bit dubious.

In my opinion, it should be titled:

"Death of the Internet Predicted Again: A Little Disingenuity"?

As Mike Masnick over on techdirt.com points out:

"So, take with a large grain of salt the latest research report claiming that the internet will collapse by 2010. Thankfully, Broadband Reports quickly picks apart the report to note that it was funded by the likes of AT&T and Level3, and it's being supported by a group whose job is to lobby for laws that help the telcos."

So maybe it's also appropriate to call this "Suckered by Astroturf".

So, come on folks — dig a bit deeper on the background of your sources. Don't take everything at face value. Please.

- ferg

Around the world, many National Research and hesslei  –  Nov 10, 2008 5:50 PM PST

Around the world, many National Research and Education Networks (NRENs) are focusing on various bandwidth-on-demand schemes for the future Internet architecture that will be used primarily for big science and cyber-infrastructure applications. The assumption is that in the future, big science institutions will produce such volumes of data that this traffic alone will easily exceed the capacity of today’s optical networks.

------------------------
hesslei....

MLS

Re: Bandwidth Demands Exceeding Internet Infrastructure Investment Irwin Lazar  –  Nov 20, 2007 6:08 PM PST

Hi, unfortunately there's a lot of mis-information going around about the report, including in fergie's comment.

We've released the entire contents of the report to anyone who wishes to read it, it is available at:

http://www.nemertes.com/internet_singularity_delayed_why_limits_internet_capacity_will_stifle_innovation_web?#

In addition, we've released a FAQ that describes the creation of the report and how it was funded:

http://www.nemertes.com/studies/internet_infrastructure_study_frequently_asked_questions_faq

I certainly do agree that one should not take what they read at face value and should indeed do their own research.

Thanks,
Irwin

Re: Bandwidth Demands Exceeding Internet Infrastructure Investment Fergie  –  Nov 20, 2007 10:09 PM PST

Well, unfortunately, it still appears to be a completely dubious position, all tolled.

Given the half-speak, vagaries, and simple assertions that are simply not based on complete fact — or indeed, based on sleight of hand — I can only dismiss this as propaganda organized by the telco lobby, as it appears to be.

I mean, let's call it what it is.

On another note, I've worked in this business for over 20 years — for ISPs, for network vendors, etc. — and I've heard all of the various half-truths positioned to attempt to compel the market.

The market always decides, and telcos hate that, because it screws their business models.

Repeat after me: The market always decides.

Time will tell whether there is some "brownout" situations that present themselves in the future, but if they do, it will be no ones fault but the telcos who have mismanaged their business interests.

I don't think that confusing telco financial desires with fundamental engineering issues is an appropriate vantage point to publish "research" sponsored by telcos.

It smells, and it smells big time.

$.02,

- ferg

Re: Bandwidth Demands Exceeding Internet Infrastructure Investment Irwin Lazar  –  Nov 21, 2007 4:57 AM PST

Hi again,
It's hard for me to respond without knowing which sections of the report you are defining as "half-speak, vagaries, or simple assertions that are simply not based on complete fact...."

WRT to the market deciding, that is one of the key conclusions of the report.  The report notes that planned investment by carriers in their access infrastructure, especially in North America, is insufficient to meet growing end-user application demands. (We noted a shortfall of over $50 billion).

Again, the report is freely available for viewing on our site (no registration is required).  If there are specific arguments in the report, or models that we've developed, that you think are wrong please let us know.  We've also set up a comment forum on the site to openly and publicly discuss the methodology, models, and conclusions of the report.

irwin

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Promoted Post

Buying or Selling IPv4 Addresses?

Watch this video to discover how ACCELR/8, a transformative trading platform developed by industry veterans Marc Lindsey and Janine Goodman, enables organizations to buy or sell IPv4 blocks as small as /20s.