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Internet nearing capacity, U.S. study says

Last Updated: Wednesday, November 21, 2007 | 5:34 PM ET

Increasing internet access and new capacity-intensive uses like streaming, interactive videos and shared music files are pushing the system toward gridlock, a U.S. study warns.

The report by Nemertes Research said "internet access infrastructure, specifically in North America, will likely cease to be adequate for supporting demand within the next three to five years."

The company is not predicting that the internet will collapse, but it will get very slow. "Overall, transmitting over a saturated broadband link will feel a lot like the bad old days of dial-up: Long pauses between request and response, with some applications just too painful to bother with."

The biggest impact will be felt as investment in new applications dries up.

"The next Google, YouTube, or Amazon might not arise, not because of a lack of demand, but due to an inability to fulfil that demand," the report said.

As well as using more high-capacity functions — nearly three-quarters of American internet users watched an average of 158 minutes of online video in May, the comScore digital measurement company reported — devices like cellphones and Blackberries are increasing internet use.

Nemertes calls for additional spending of up to $55 billion US, or about 70 per cent more than internet service providers are planning to spend, to build new capacity to avoid the slowdown. 

The report is based on consultations with academic and industry research organizations, interviews with more than 70 enterprises, vendors, service providers and investment companies, as well as the company's own data.

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