The glass is greener: an explosion in capacity

Back in 2007, my company predicted that demand for network bandwidth — specifically IP bandwidth — would exceed capacity in the 2010/2011 timeframe. We arrived at that conclusion by independently modeling network consumption and capacity (and factoring in go-forward changes in both), and we highlighted growth in wireless as a key element in driving demand.

Three years later, it's clear we were right. AT&T recently introduced metered-usage pricing for wireless data services, essentially a pay-as-you go option for IP data services users -- a clear indication that current "all you can eat" models aren't keeping up with demand. And In-Stat Research estimates that 90,000 Gbps of capacity in the last mile of the backhaul network will be needed by the end of 2013 to support the world's cellular and WiMAX networks.

That's the bad news. The good news is that a host of companies — from start-ups to established firms — are stepping up to meet the demand. Last month, start-up Allied Fiber announced plans to invest $140 million into a dark-fiber network that will connect New York, Chicago and Ashburn, Va. The network relies on right-of-way licensed from several major railroads (the company has publicly announced Norfolk Southern Railway) and other right-of-way owners. It also includes collocation facilities and fiber-connected wireless towers.

To continue reading, register here and become an Insider. You'll get free access to premium content from CIO, Computerworld, CSO, InfoWorld, and Network World. See more Insider content or sign in.

Back in 2007, my company predicted that demand for network bandwidth — specifically IP bandwidth — would exceed capacity in the 2010/2011 timeframe. We arrived at that conclusion by independently modeling network consumption and capacity (and factoring in go-forward changes in both), and we highlighted growth in wireless as a key element in driving demand.

Three years later, it's clear we were right. AT&T recently introduced metered-usage pricing for wireless data services, essentially a pay-as-you go option for IP data services users -- a clear indication that current "all you can eat" models aren't keeping up with demand. And In-Stat Research estimates that 90,000 Gbps of capacity in the last mile of the backhaul network will be needed by the end of 2013 to support the world's cellular and WiMAX networks.

That's the bad news. The good news is that a host of companies — from start-ups to established firms — are stepping up to meet the demand. Last month, start-up Allied Fiber announced plans to invest $140 million into a dark-fiber network that will connect New York, Chicago and Ashburn, Va. The network relies on right-of-way licensed from several major railroads (the company has publicly announced Norfolk Southern Railway) and other right-of-way owners. It also includes collocation facilities and fiber-connected wireless towers.

Internationally, GlobeNet, a wholly owned subsidiary of Brazilian carrier Oi recently upgraded its 22,000-km cable system connecting the U.S. and Latin America, adding an additional 110Gbps of capacity per fiber pair. And Alcatel-Lucent recently inked a deal with 20 global carriers to install a 17,000-km, 5.12TBps submarine cable that will connect 20 African countries to France.

Thanks to the hockey-stick increase in bandwidth demand -- growing anywhere from 50% to 100% year-over-year -- the companies making these investments are seeing dramatic growth themselves, reporting revenue growth rates in the 40% year-over-year range.

Which brings me to my main point: When it comes to the IT/networking space, we've been hearing nothing but bad news for the past few years. Yet hundreds of companies are growing dramatically, thanks to the voracious hunger for "glass in the ground" (or underwater). As long-term-evolution (LTE) wireless begins to roll out later this year, this hunger will only increase -- and that's before wireless sensor networks

And that's good news for a lot of folks. Already, I'm hearing from companies complaining of talent shortages -- particularly for optical engineers -- something we haven't heard for quite a while.

Are we on the verge of another tech explosion, this time for raw capacity? It seems so. As enterprises and other organizations continue to invest in embedded intelligent networks (smartgrids, sensor networks, personal healthcare monitors, etc) and consumers and businesses alike consume every scrap of wireless and wireline bandwidth for multimegabit wireless connectivity, HD video, and who-knows-what next-generation applications, the effort to put enough capacity in place is going to go into hyperdrive. For those of us who remember the tech bubble, the dynamics will feel vaguely familiar. But this is no bubble -- the glass really is greener, this time.