AT&T: Internet to hit full capacity by 2010

U.S. telecommunications giant AT&T has claimed that, without investment, the Internet's current network architecture will reach the limits of its capacity by 2010.

Speaking at a Westminster eForum on Web 2.0 this week in London, Jim Cicconi, vice president of legislative affairs for AT&T, warned that the current systems that constitute the Internet will not be able to cope with the increasing amounts of video and user-generated content being uploaded.

"The surge in online content is at the center of the most dramatic changes affecting the Internet today," he said. "In three years' time, 20 typical households will generate more traffic than the entire Internet today."

Cicconi, who was speaking at the event as part of a wider series of meetings with U.K. government officials, said that at least $55 billion worth of investment was needed in new infrastructure in the next three years in the U.S. alone, with the figure rising to $130 billion to improve the network worldwide. "We are going to be butting up against the physical capacity of the Internet by 2010," he said.

He claimed that the "unprecedented new wave of broadband traffic" would increase 50-fold by 2015 and that AT&T is investing $19 billion to maintain its network and upgrade its backbone network.

Cicconi added that more demand for high-definition video will put an increasing strain on the Internet infrastructure. "Eight hours of video is loaded onto YouTube every minute. Everything will become HD very soon, and HD is 7 to 10 times more bandwidth-hungry than typical video today. Video will be 80 percent of all traffic by 2010, up from 30 percent today," he said.

The AT&T executive pointed out that the Internet exists, thanks to the infrastructure provided by a group of mostly private companies. "There is nothing magic or ethereal about the Internet--it is no more ethereal than the highway system. It is not created by an act of God, but upgraded and maintained by private investors," he said.

Although Cicconi's speech did not explicitly refer to the term "Net neutrality," some audience members tackled him on the issue in a question-and-answer session, asking whether the subtext of his speech was really around prioritizing some kinds of traffic. Cicconi responded by saying he believed government intervention in the Internet was fundamentally wrong.

"I think people agree why the Internet is successful. My personal view is that government has widely chosen to...keep a light touch and let innovators develop it," he said. "The reason I resist using the term 'Net neutrality' is that I don't think government intervention is the right way to do this kind of thing. I don't think government can anticipate these kinds of technical problems. Right now, I think Net neutrality is a solution in search of a problem."

Net neutrality refers to an ongoing campaign calling for governments to legislate to prevent Internet service providers from charging content providers for prioritization of their traffic. The debate is more heated in the United States than in the United Kingdom because there is less competition between ISPs in the States.

Content creators argue that Net neutrality should be legislated in order to protect consumers and keep all Internet traffic equal. Network operators and service providers argue that the Internet is already unequal, and certain types of traffic--VoIP, for example--require prioritization by default.

"However well-intentioned, regulatory restraints can inefficiently skew investment, delay innovation, and diminish consumer welfare, and there is reason to believe that the kinds of broad marketplace restrictions proposed in the name of 'neutrality' would do just that, with respect to the Internet," the U.S. Department of Justice said in a statement last year.

The BBC has come under fire from service providers such as Tiscali, which claim that its iPlayer online-TV service is becoming a major drain on network bandwidth.

In a recent posting on his BBC blog, Ashley Highfield, the corporation's director of future media and technology, defended the iPlayer: "I would not suggest that ISPs start to try and charge content providers. They are already charging their customers for broadband to receive any content they want."

Andrew Donoghue of ZDNet UK reported from London.

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