Gridlock on The Broadbahn

By Rob Fixmer  |  Posted 2001-01-15 Print this article Print

Those of us who live in the 'burbs and work in the traffic hell of Manhattan have no trouble predicting that the real business opportunities in the foreseeable future are going to lie in infrastructure technologies and communications services.

Those of us who live in the burbs and work in the traffic hell of Manhattan have no trouble predicting that the real business opportunities in the foreseeable future are going to lie in infrastructure technologies and communications services. We have an enormous bandwidth problem in New York. Even the fastest, most expensive car in the showroom wont squeeze us through the bridges and tunnels any faster, so we use trains, buses or ferries each day to get to our jobs.

Fortunately for the auto industry, that isnt the case everywhere. In most parts of the country, for better or worse, people still drive to work. Would that the personal computer industry were so lucky. As the PC has metamorphosed from a word and number tool to an interactive communications device, its once natural, built-in obsolescence — the need for an ever-faster processor — has faded away to near irrelevance.

Now the issue is a dearth of high-speed bridges and tunnels. Were all driving perfectly adequate late-model PCs, equipped to handle all manner of multimedia content. But all that dazzling content is somewhere out in cyberspace, and we cant get there from here. The traffic jam on the backbone is getting worse each day, but thats relatively easy to fix. The real problem is the last mile. New bridges and tunnels are being built at an excruciatingly slow pace, and until theyre in place, theres very little incentive to buy this years model PC.

Nor do the bottlenecks bode well for chipmakers and software companies. Analysts argue that these industries will find sanctuary in the so-called post-PC era, when we will all move from bulky desktops and laptops to Web appliances, third-generation cell phones and wireless handheld devices. But even these motor-scooter technologies are waiting their turn at the tunnel.

Sure, consumer electronics makers will no doubt sell a few more e-mail devices, and its realistic to expect exciting new digital markets in interactive television. But the kind of bandwidth with any real chance of kick-starting these industries — the kind that can deliver multimedia content in something approaching real-time across the U.S. — remains years away for most of us.

Why are we in this pickle? Because short-term greed invariably trumps a credible long-term investment strategy. The Baby Bells got caught up in a consolidation frenzy that made a handful of executives wealthy, but left businesses and consumers without bandwidth. Ameritech, for example, hid enormous infrastructure problems during talks to be acquired by SBC Communications, leaving tens of thousands of customers with unreliable phone service. The merged company is spending billions of dollars to fix those problems — an expense that will squeeze stockholders as Digital Subscriber Line expands.

Nor is the cable industry faring much better. When Michael Armstrong steered AT&T into cable as his last-mile solution, he picked the right technology but the wrong company. By the time he paid an outrageous premium for Tele-Communications Inc., the cable industry was already billions of dollars behind in essential infrastructure improvements. Its not clear that AT&T can survive the costs of upgrades needed to deliver high-speed data services over cable across its network. And in the meantime, the company has seriously damaged @Home, the only large-scale cable modem service provider, by changing missions and business plans every few weeks.

In some ways, AOL Time Warners cable infrastructure problems are worse than AT&Ts, although Steve Case and Bob Pittman have at least demonstrated they can be enlightened innovators in consumer markets.

So, as we all wait impatiently for high-speed wireless to become a reality, its clear the majority of the country will be walking cyberspace at dial-up speeds for the foreseeable future. If that forces the PC industry into hibernation mode, the market ramifications could be disastrous.


Rob joined Interactive Week from The New York Times, where he was the paper's technology news editor. Rob also was the founding editor of CyberTimes, The New York Times' technology news site on the Web. Under his guidance, the section grew from a one-man operation to an award-winning, full-time venture.

His earlier New York Times assignments were as national weekend editor, national backfield editor and national desk copy editor. Before joining The New York Times in 1992, Rob held key editorial positions at the Dallas Times Herald and The Madison (Wisc.) Capital Times.

A highly regarded technology journalist, he recently was appointed to the University of Wisconsin School of Journalism's board of visitors. Rob lectures yearly on new media at Columbia University's School of Journalism, and has made presentations at the Massachusetts Institute of Technology's Media Lab and Princeton University's New Technologies Symposium.

In addition to overseeing all of Interactive Week's print and online coverage of interactive business and technology, his responsibilities include development of new sections and design elements to ensure that Interactive Week's coverage and presentation are at the forefront of a fast-paced and fast-changing industry.


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