For the past few years, I've had an item lingering on my list of potential
column topics: The possibility of a physical crash of the Internet.
It goes back to a prediction by Bob Metcalfe, one of Ethernet's early
designers, that consumption would exceed capacity by 1995. Now that we're in the
middle of the year 2000, with the electricity still running, it seems an
appropriate time to safely put this fear away along with every other apocalyptic
prediction.
This doesn't mean the Internet is out of the woods, though. The Net now runs
on much more tenuous, yet also more powerful, substances than mere fiber-optic
lines. It runs on faith and money--and the two, permanently intertwined, are both
subject to inertia.
The momentum of the Net has translated into the most rapid infiltration of
popular culture ever. But is it unstoppable?
Simple logic would suggest that the expansion and acceptance of the Internet
is inevitable: It is moving like a rocket, and rockets are hard to stop. But it
is an oversimplification to compare the advance of a social and financial
phenomena to a purely physical object.
Since the initial public offering of Netscape in 1996, the Internet's success
has become tied to the stock market, which breaks the laws of physics several
times a day. So, providing enough bandwidth to support the Internet's growth is a
big task, but it is also a technical project and therefore definable.
The money that supports the Internet, on the other hand, derives from
faith--and the formula for maintaining that has yet to be clearly defined.
Predicting a cashwidth crash for the Internet will probably prove as much of a
Chicken Little prognostication as a bandwidth blackout has, but there are two
areas of concern:
The burst of the investment bubble. Once upon a time, a company's stock
price rose and fell with some correlation to its profitability. The stocks of
e-commerce companies, of course, violate that logic. They aren't the first to do
so, of course: Speculative industries like biotech in the 1980s have seen stock
inflation despite a lack of results. The collective mind of Wall Street loves to
gamble. Of course, that mind is also certifiably mad.
There have already been a few cautionary incidents in the tech-stock arena. A
prominent software maker, Microstrategy, has recently been criticized (and sued
by shareholders) over possible misrepresentation of financial results.
"Technology has outstripped accounting guidelines," claimed Michael Saylor,
