The demand for high bandwidth in North America will explode over the next eight to 10 years, driven by the increasing number of Internet users and the complex applications and content traversing cyberspace.
Such are the findings by telecom analyst firm RHK in its latest report, Internet Traffic and Use: Surging Not Slowing, which was commissioned by Nortel Networks. The San Francisco-based RHK stated the report on the growth of bandwidth demand counters recent claims that there is too much bandwidth. For instance, the study reads, 400,000 North American homes per month are adopting high-speed Internet access; high-speed Internet users spend 61 per cent more time on-line than a year ago because the high-speed experience is more rewarding; by July 2001 there will be 800 million Internet users worldwide - up from 380 million today.
"We've been seeing some pretty amazing growth on the international front," remarked Tracy Vanick, technical director for RHK. "North America used to be the dominant force in Internet traffic. North America in 1999 comprised about half of all Internet users; that figure is now down to about 40 per cent."
Vanick explained the expansive growth of European and Asian-Pacific cyber markets is the crux of RHK's findings.
"The Internet growth in China alone is about 2 million new users added per month and that's a phenomenal increase over the course of a year," she said. "Plus, there are already over 2 million high-speed users in Korea while Japan too is proving to be an Internet powerhouse."
The RHK report alludes to a third wave of Internet access: the adoption of Ethernet-speed access in the home and gigabit Ethernet access used by businesses as well as a behavioural change in people who will modify their social, business and entertainment lives to revel in new services wrought from a faster, free Internet.
Vanick explained the report derived from earlier studies compiled by RHK detailing global Internet traffic in general. She added Nortel was interested to see if its current strategies were still worthwhile.
"[It was commissioned] in order to justify the capital expenditures after the stock market took a down turn last year," she said. "There's definitely more traffic to be carried, we can't slow down now."
Nortel Networks - which recently announced it will slash 750 jobs at its Ottawa operations and 200 jobs at its Brampton, Ont., plant in an effort to focus on building fibre-optic products - was pleased with the RHK findings.
"The findings show the explosive boom in Internet usage is unstoppable and inevitable," said Anil Khatod, president of Nortel's Global Internet Solutions division. "The potential of the Internet is limitless in North America and the rest of the world. Our challenge is to make the Internet profitable for our customers and that's a challenge we are addressing."
Meanwhile, on Jan. 11 the Canadian federal government introduced a new task force - the National Broadband Task Force - whose mandate will be to advise Ottawa on how to ensure high-speed Internet access for all Canadian communities by 2004.
"We must ensure that all Canadian communities, no matter where they are, can reap the benefits of broadband Internet services," said Industry Minister Brian Tobin. "Access to high-speed broadband will provide the foundation for improved services such as distance learning and tele-health, and it will foster both regional and local economic development."
The task force - under the chairmanship of University of Waterloo president Prof. David Johnston - is comprised of persons from all regions of the country, and incorporates industry stakeholders, digital content producers, rural communities and aboriginal groups, as well as education and health care communities.
In related news, Ottawa is accepting bids for additional personal communications services (PCS) spectrum in the 2GHz frequency range from cellular providers in a Jan. 15 auction.
Seven of the country's biggest wireless providers are registered to participate in the auction: BC-Telus, Bell Mobility Inc., Microcell Telecommunications Inc., Rogers Wireless Inc., Thunder Bay Telephone, W2N Inc., and Sprint PCS Canada Holdings Inc. Wireless companies contend one in three Canadians use a cell phone, the majority of whom want Internet access on their portable device. There are a total of 62 licences of 10 MHz each available in 16 market areas across Canada.
Industry Canada expects to raise $2 million from the auction.