Just returned from participating on a panel called "The Exaflood: Managing the coming digital deluge" at the always outstanding Gilder / Forbes Telecosm. The theme this year was "The Exaflood," i.e., the rapidly growing flood of digital information on the Internet and enterprise data networks.
The panel was moderated by Bret Swanson, a Senior Fellow at the Discovery Institute and Director of the Center of Global Innovation at the Progress and Freedom Foundation. It comprised Andrew Odlyzko, Professor at and Director of the Digital Technology Center at the University of Minnesota; Bob Metcalfe, Ethernet inventor and author, now at Polaris Venture Partners; Johna Till Johnson, President of Nemertes Research; Tom Evslin, founder and former CEO of ITXC and "Fractals of Change" blogger; Lane Patterson, Chief Technologist at Equinix, Walt Ordway, former CTO of the Digital Cinema Initiative, and myself.
There was a diversity of opinion regarding the growth of demand and how to measure it, both recently and over the next few years. Andrew Odlyzko began with a fairly modest estimate of growth rates, pointing out that correctly forecasting growth rates is key for the service provider and equipment vendor industry, since if they are unexpectedly high, congestion and service outages will follow, but if they are unexpectedly low, then overcapacity and poor ROIs will occur. Then, Bret Swanson, who moderated the panel and is a Senior Fellow at the Discovery Institute, recapped a recent study he conducted with George Gilder, excerpted in the Wall Street Journal, projecting a 50-fold growth rate in Internet traffic through 2015, which translates to a 54% CAGR. Johna Johnson then discussed the difficulty of acquiring good data, since core network traffic data is likely to differ from edge data that doesn't traverse service provider cores. She quoted Nemertes projections of 100% growth. Johna also pointed out that it can be difficult to determine unserved demand.
Who's right? Well, ask again in 2015. In the meantime, core network growth rates of 60% annually, which is what we've seen on a regular basis over the last few years, are unlikely to slow. In fact, if anything, the opposite is likely to happen, as multi-megabit/s consumer broadband access increases, consumer desktop HD video streaming grows, consumer IPTV gets deployed, peer-to-peer file sharing continues, and enterprise video conferencing from desktops and immersive Telepresence solutions accelerate. Even mobile video bandwidth continues to grow due to synchronous real-time video, both uplink, downlink, and full duplex. Next generation network upgrades to OC-768 and 3G HSPA deployments and 4G LTE spectrum acquisitions and deployments over the coming years mean that wireline and wireless capacity will be growing, hopefully in tandem with the Exaflood of demand.