Wag the Dog: Bandwidth and the Next "KillerApp"

Posted: 05/1999

Wag the Dog: Bandwidth and the Next "Killer
App"
By David Finkelstein

The Holy Grail in the communications industry is the constant search for the next
killer application. Companies spending small fortunes building out their long-haul
backbone networks seem to be searching desperately for the killer app that will justify
the tremendous amount of bandwidth that is coming online. Perhaps, however, we found the
killer application a long time ago and didn’t even know it.

That killer app may in fact be bandwidth itself–because history repeatedly has shown
us that network capacity itself generates further demand for network capacity. Just like
the comic book character Pogo, who proclaimed, "We have met the enemy, and it is
us," we now are realizing that bandwidth itself is generating the explosive demand
for more bandwidth.

During the past 20 years, we have seen repeatedly that the so-called "expert"
forecasts of demand for network capacity have been systematically conservative as actual
demand and deployed applications far exceeded previously anticipated demand levels. A
quick look at the history of the paging, wireless and fiber optic industries demonstrates
just how pervasive this tendency to underestimate potential demand for capacity has
become.

Early estimates in the mid-’70s of the potential demand for paging services was limited
to a few high-value niche markets. Since then, the development of widespread services at
constantly falling price points has resulted in mass markets from teen-agers to senior
citizens–hardly the "niche" applications originally anticipated.

Similarly, cellular phones originally were thought to be only viable for the
"power brokers" and other exclusive, high-income individuals. No one in his
wildest dreams could have imagined penetration rates of more than 50 percent, as now is
being seen in Scandinavia. No one ever would have imagined fixed substitution, in which
customers are canceling their regular phone service and replacing it with cellular
service. No killer app is necessary to understand this phenomenon–simple network
expansion, fueling lower prices and increased competition, is all the explanation needed.

Perhaps the most striking example of this trend is found in the deployment of fiber
optic cables. When fiber optic technology originally was developed in the early 1980s,
most companies concluded that it would not be feasible economically to lay more than a
couple of transcontinental trunks for their long-haul, high-speed networks. Yet despite a
tremendous rise in the carrying capacity of a single fiber strand, especially with the
recent arrival of wavelength-division multiplexing (WDM) and dense WDM (DWDM)
technologies, thousands of miles of fiber cables currently are being laid throughout the
country and around the world. Industry’s appetite for fiber capacity currently appears
insatiable. Yet again, there’s no killer app–just the bandwidth itself generating the
need for even more bandwidth.

With the Internet and the World Wide Web, the development and deployment of uses for
these new media followed their actual existence. The recognition of the immense
potential of the Internet and the World Wide Web, in fact, spurred the creation of
multiple applications for them. No single application currently dominates or
"hogs" the bandwidth available on existing networks. It is the aggregate of a
huge number of constantly evolving applications and services that eats up the existing
bandwidth. And these applications create a sort of "snowball" effect, driving
the development of new and increasingly bandwidth-hungry applications at an accelerating
rate.

So in the end, it looks as if the search for the next killer application has been
misdirected. Bandwidth is the killer application. Increasing it by building out the
long-haul, fiber optic backbones on a national and international scale is the first step
in deploying the killer app. Imple-menting ways to access it quickly is the next step.
Currently, only a few people with dedicated high-speed connections to the Internet
effectively can utilize all its available bandwidth. Through a combination of technologies
such as digital subscriber line (DSL), cable modems and broadband satellites, high-speed
broadband access can be achieved for the entire globe. This will, in turn, stimulate the
development of new applications and uses for the Internet’s bandwidth.

The question, then, is not whether creating additional bandwidth is necessary, but
whether the applications and services that will be developed as a result of increased
bandwidth and broadband access speeds can be supported by the networks of tomorrow.
We therefore should be more concerned with getting on with building the major components
of the worldwide high-bandwidth network, rather than staring into our crystal balls in a
futile effort to be the first to spot the next killer app.

David Finkelstein is senior vice president-marketing and business development for
SkyBridge LP, Bethesda, Md., a provider of local-loop broadband capacity for interactive
multimedia services to operators and service providers. He can be reached at [email protected].