Internet traffic, bandwidth, architecture, and management

1
Internet traffic, bandwidth, architecture, and
management

• Andrew Odlyzko
• Digital Technology Center
• University of Minnesota
• http//www.dtc.umn.edu/odlyzko

2
Internet traffic (but not revenues) growing
vigorously

• US growth rate down to about 70 per year
• rest of world probably close to 100

Telecom problems

• overinvestment of bubble years
• thorough restructuring

3
AMSIX (Amsterdam Internet exchange) traffic
month
TB/month Aug-98 24 Aug-99 81 Aug-99 348 Aug-01 769
Aug-02 2,445 Aug-03 3,870 Aug-04 7,919
4
Official government statistics collection finally
starting
MB (megabytes) of data downloaded per person per
month
Australia
Hong Kong
month MB/person Mar 2002 31 Sep
2002 49 Mar 2003 52 Sep 2003 79 Mar 2004
108
month MB/person Jan 2002 212 Jul
2002 327 Jan 2003 581 Jul 2003 1,598 Jan
2004 2,855 Jul 2004 4,529
rough estimates for other countries today (Oct
2004)
US 1,000 MB/person S. Korea 2,700 MB/person
5
Volume and value only weakly related

• Revenue per MB for various services

Service Typical monthly bill Revenue per MB
Cable 40 0.00012
Broadband Internet 50 0.025
Wireline phone 70 0.08
Dial Internet 20 0.33
Cell phone 50 3.50
SMS 3000.00
6
Long-haul is not where the action is

• 360networks transatlantic cable

Construction cost 850 M
Sale price 18 M
Annual operating cost 10 M
Lit capacity 192 Gb/s
Ave. transatlantic Internet traffic 70 Gb/s
(mid 2003)
7
Migration of Costs to EdgesNew Business Models

• Customer-owned networks
• Outsourcing
• Analogies with multi-modal transportation
  model

8
Additional data and speculations
www.dtc.umn.edu/odlyzko
Especially in the papers The many paradoxes of
broadband Internet traffic growth Sources and
implications Pricing and architecture of the
Internet Telecom dogma and spectrum allocations