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Traffic Growth Isn't Using Up the Internet


Yes, cable systems are congested, but the logjam is being alleviated by upgrades in technology

Are we running out of Internet? That's what some experts say. AT&T's (T) top lobbyist, James Cicconi, recently warned that "we are going to be butting up against the physical capacity of the Internet by 2010." Cicconi and others say this warrants charging heavy users a premium, and he doesn't want new laws that would stop AT&T from doing so.

Advocacy groups say that if the AT&Ts and Comcasts of the world have their way with Congress, they'll slow transmission of movies and video on the Net—except when it's content they provide for a fee. They have a point. The service providers' lobbying is all part of a major fight over government's role in ensuring access to Internet content, an issue known as "Net neutrality." Unfortunately, the debate is generating a lot more heat than light, with neither side willing to let the facts get in the way of a passionate argument.

The service providers have an interest in creating the impression that Internet capacity is a scarce and expensive resource. AT&T executive Richard N. Clarke argued in a recent white paper that the cost of providing unlimited Internet service to some homes may be as high as $416 a month. Such claims bolster service providers' arguments that, to manage their networks efficiently, they must closely monitor what their customers are doing and possibly impose surcharges or caps to control excess usage.

The problem is, there's little evidence of any capacity shortage. Despite a surge in online video watching, the growth of Internet traffic does not appear to be accelerating. An ongoing Internet traffic study at the University of Minnesota and parallel research by Cisco Systems (CSCO) show that traffic is growing at 35% to 50% a year, about the same rate as in the past several years. "If anything, the trend is down rather than up," says Andrew Odlyzko of the University of Minnesota's Digital Technology Center. "There is no sign of the [predicted] explosion of traffic."

That's not to dismiss the growth or deny that it presents challenges. Cicconi actually understated the case when he said AT&T expects volume to increase fiftyfold by 2015; at current growth rates, the increase will be closer to a hundredfold. But this is the same growth rate network providers have coped with for years.

The fact is, technological advances have allowed massive increases in the data capacity of networks, and those advances keep coming. Yes, there is growing congestion on cable systems, where the final bit of bandwidth is shared, leading Comcast (CMCSA) to impose a 250GB-per-month limit on some subscribers. But the logjam is being alleviated by upgrades in cable technology, so Comcast's new rules will probably be short-lived. With prices falling on the fiber-optic cables and routers that make up the Internet, a capacity crunch seems unlikely in the next two years.

If the big service providers are resorting to hyperbole, the same is true of their opponents. On its Web site, the SavetheInternet.com Coalition warns that the phone and cable companies "want to tax content providers to guarantee speedy delivery of their data. They want to discriminate in favor of their own search engines, Internet phone services, and streaming video—while slowing down or blocking their competitors."

There is barely a shred of evidence in word or in deed to support such claims. It's true that the Federal Communications Commission recently sanctioned Comcast for violating principles of network neutrality by interfering with a fast file-sharing technology called BitTorrent. It was a ham-handed effort, and Comcast compounded the damage by failing to come clean when users complained. But there's no sign Comcast was acting out of malice.

There are valid questions about how governments should manage networks, if at all. But at this point, exaggerations and distortions are standing in for serious debate.

Wildstrom is Technology You columnist for BusinessWeek. You can contact him at techandyou@businessweek.com or follow his posts on Twitter @swildstrom.

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