News Analysis: Singing along as the bandwidth plays on

ISPs need to do more to survive than just attempt to meet the ever-growing demand for bandwidth

The industry as a whole is struggling to find a solution to the problem of supply and demand. And in the networking industry, this problem has got more serious as there appears to be no way that networking vendors can keep up with the internet demand of the 90s.

At the Hambrecht & Quist Planet Wall Street Enterprise conference in San Francisco last week, John Sidgmore, CEO at UUNet, set the scene. ?We literally sell every ounce of bandwidth we deploy almost the moment that we?re deploying it,? he said.

Sidgmore was speaking at of the panel session entitled ?Redesigning the Network?.

The panel discussed issues facing the networking industry ? from the perspectives of both supplier and user ? as the explosion in adoption of internet centric business practices puts additional pressures on the existing infrastructure.

?Demand on the internet is growing faster than any technology in history,? said Sidgmore. ?The demand on the network is doubling every three months. That means our network increases in size by 1,000 per cent every year. Right now we have a three-year planning horizon. We?re planning for a network a thousand times the size of our current network.?

This expansion is fuelled by the increase in corporate use of the Net for serious commercial applications. ?The business market, with respect to the internet, has grown up in the past couple of years,? said Sidgmore.

?Between now and 2000, the biggest driver of demand on the internet will be the big, boring corporate application of old migrating from its current position on internal networks on to the public internet. As that happens, things like security, reliability and quality get dramatically more important.?

Ed Kozel, chief technology officer at Cisco Systems, echoed Sidgmore?s views, arguing that mainstream acceptance of the Net brought with it excessive pressure on the existing infrastructure. ?The amount of bandwidth needed goes up dramatically, as well as the expectations of reliability and stability because companies are putting up business processes, not just corporate advertising,? he said.

Sidgmore highlighted the problems that online service provider America Online (AOL) had experienced in the past few months with users unable to get on to the system. ?The rate of the growth of network demand has been accelerating for the past 18 to 20 months,? he said.

?We are literally supply constrained. If you think about the problems with AOL and other online services, people cannot get on those networks because they?re hugely congested.?

This raises serious issues about the quality of service that can be expected from ISPs and other networking suppliers. ?I think there?s a big difference between the quality requirements of most people that use the public network and people that really want to use internet technology within their companies,? added Sidgmore.

?When people talk about quality today, most think in terms of busy signals on the network. This really has nothing to do with the internet ? it has something to do with AOL not really providing enough modems to meet its new pri-cing strategy, or with someone not buying enough access to the server.

?Our research has found that corporations are willing to pay differentiated prices for differentiated levels of service and quality and that?s easy to do today,? he said. ?We can provision virtual private networks off of our public internet network today, take off those pieces and provide dramatically higher quality to corporations, if they want to pay for it.?

Kozel approached the service quality issue from a different tack. ?Price/performance is inherently a box-level type of thing,? he argued. ?The guy next door can build a smaller, faster box tomorrow ? the guy next to him, the day after that can build a smaller, faster box. You can create a performance model with that, but not a service model.?

?Quality of service is a theoretical concept developed for some technologies, but it has not in fact been materially deployed,? said Kozel.

?It is starting to be deployed in 1997 by several large ISPs, but even that is, I think, acknowledged to be mostly a learning lesson ? trying to understand what the market will pay, how they can provision it and how they can offer multiple levels of service.?

While these lessons are learned, networking suppliers can look forward to a boom in business. But Fred Sammartino, director of IP marketing at Cascade Communications and founding president of the ATM Forum, warned that despite the ever-increasing demand for bandwidth, the phenomenal growth of companies in the sector would not last.

So as ISPs attempt to come to grips with the demand, they also need to be aware that the internet boom cannot last forever. For ISP companies to continue to stay in business once that boom has died away, they need to make sure they differentiate themselves from the hundreds of other providers out there.

Sammartino said: ?It?s certain that the bandwidth is increasing exponentially, but at the same time, the cost per bit is dropping, but not as fast.

?We?re still maintaining huge growth rates. It?s just that as small firms grow into medium-sized and larger firms, it?s impossible to maintain a 100 or 200 per cent growth. If Cisco kept up its current growth rate, it would employ every person in the world by about 2010.?