Study Warns Internet Gridlock by 2010

Consumer demand for bandwidth could see the internet running out of capacity as early as 2010, a new study warns. US analyst firm Nemertes Research predicted a drastic slowdown as the network struggles to cope with the amount of data being carried on it.

Such gridlock would drastically affect how people use the web and could mean the next Google or YouTube simply doesn't get off the ground, it said. The report said billions needed to be spent upgrading broadband networks. It put the figure at around $137bn (£66bn) globally. For users, the slowdown could see a return to the bad old days of dial-up, the report predicts. Stifling innovation

"It may take more than one attempt to confirm an online purchase or it may take longer to download the latest video from YouTube," the report cited.

But it is the knock-on effect for new services that could be the real problem, report authors think. "The next Amazon, Google or YouTube might not arise, not from a lack of user demand but because of insufficient infrastructure preventing applications and companies emerging," the report warned.

The demand for bandwidth-intensive applications shows no sign of abating. Nearly 75% of US internet users watched an average of 158 minutes of online video and viewed more than 8.3bn video streams during May, according to research by measurement firm comScore.

The financial investment required to "bridge the gap" between demand and capacity would range from $42bn (£20bn) to $55bn (£27bn) in the US, Nemertes estimates.

The report is part-funded by the Internet Innovation Alliance (IIA) which campaigns for universal broadband in the US. "We must take the necessary steps to build out network capacity or potentially face internet gridlock that could wreak havoc on internet services," said Larry Irving, co-chairman of the IIA.