Video to Push Internet to Limits

There’s a great piece by reporter John Van in the Chicago Tribune today that discusses the urgent need for increased capacity on the Internet. He writes:

A recent report from Deloitte Consulting raised the possibility that 2007 would see Internet demand exceed capacity. Worldwide, more users every day join the 1 billion people who now use the Internet. Popularity of bandwidth-hungry video makes far greater demands on the network than more basic applications like e-mail, Web browsing or even voice over the Internet.

“For some service providers,” the Deloitte report said, “video-chat traffic already exceeds voice volumes, and given that a minute of video requires 10 times the bandwidth as voice, the threat to bandwidth becomes clear.”

David Tansley, a London-based Deloitte partner, said that “so many business models assume Internet capacity to be ubiquitous and inexpensive that capacity isn’t seen as a limiting factor in applications.

“Yet little thought is given to how infrastructure providers may be [enticed] to keep investing.”

While the network was famously overbuilt during enthusiasm of the 1990s Internet bubble, much of that capacity is being used now or soon will be, Tansley said, and network operators are faced with making significant investment to expand capacity further to meet growing demands fueled largely by video applications.

“2007 may be the year of the tipping point where growth in capacity cannot cope with use,” Tansley said.

Net Neutrality mandates would simply exacerbate this looming shortage. Instead, we need regulatory reform for the telecom sector that brings more investment, innovation, and competition to solve this problem.