We've heard many tidbits relating to internet traffic growth lately, let's connect a few of the dots. Cogent says traffic growth has really slowed, Global Crossing is seeing triple digits, and the rest see no substantive change in how many bits are on their network. Akamai says they're seeing less traffic, Limelight disagrees. All in all, a mixed bag that implies not much has changed and that variations are largely company specific. So growth of 40-60% annually seems likely.
Telegeography tells us that in the USA from July 2007 to July 2008, while the growth was slower traffic still grew faster than the networks added capacity. Infinera and Ciena speak of their customers delaying network buildouts and the effects they expect on sales are large enough that we can't really doubt them much. Infinera serves mostly Tier-2 networks, Ciena serves some Tier-1 networks as customers and blamed them specifically. So we can conclude that this effect is industry-wide are adding capacity slower now than they were last year.
This would seem to imply that in the USA, network providers are going to be running their backbones hotter than they have in some time. This may lead to more bottlenecks and the effects of outages will be felt more severely. It opens the opportunity perhaps for those who specialize in getting through less reliable networks. Internap would be one company that might stand to benefit, this sort of thing is what their network and advanced routing solutions are designed to mitigate. Content distribution networks will also see their share of the pie grow if the internet gets balky - and Internap has one of those too, though it isn't in the top 3 and has struggled.
It would also seem to imply that the internet backbones are definitely not expecting the so called 'exaflood' of video to hit the internet anytime soon, i.e. for the next year. Well, we heard that from Andrew Oldyzko as well, and I don't see any reason to dispute it. So there we are, the exaflood isn't coming, internet growth has even slowed a bit, but not by all that much. Yet carriers are cutting back even more than they already were on building capacity to meet the traffic growth we do have so beware of traffic jams anyway - exaflood or no exaflood.
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