ARE WE AT PEAK BITS?
Concern as net hits data limits
At the turn of the last millennium financial markets around the world realised that the valuations they were offering for companies whose business plans included the word internet were completely ridiculous and that there was no way most of them were ever going to make money.
Share prices for those that had already floated collapsed; second round venture funding for start-ups disappeared, even for good ideas with a solid track record; and the angel investors took their money elsewhere.
Individual investors - the "day traders" who had sunk their savings into stocks that looked like they would grow forever - lost the most money, but pension funds, insurance companies and other big holders of shares also suffered. The companies, large and small, went under.
Who now remembers etoys.com or Online Publishing?
But the effect of the collapse was like a neutron bomb, a nuclear weapon that produces high doses of radiation but with a relatively small explosion, and the damage it did was limited.
A neutron bomb is designed to kill people but leave buildings standing, while the effect of the dotcom crash was to close down companies but leave the network intact. The web servers went as companies like boo.com turned off their sites, but the cables in the ground, the routers that connected them together and the infrastructure of the internet itself remained in place.
We can see this most clearly in the growth of online video, where concerns about network congestion are already being expressed.
Recently I've been playing with Joost, the recently-announced video-streaming service from the people behind Skype and, before that, Kazaa.
It's still in beta, but already it's clear that it provides an easy-to-use front end and decent quality video, something that other streaming services are going to find hard to match.
Unfortunately it is a real bandwidth hog that will suck up as many bits per second as it can get, and because it is a peer-to-peer service it sends as well as receives. Joost adoption rates are likely to be high, especially if they manage to sign up some interesting content, and when the BBC's iPlayer is finally made available it will add to the load.
Edited by SemiBizz, 15 April 2007 - 03:42 PM.
