Devil's Advocate: WorldCom affair raises broader question

Time to rethink the internet?

Time to rethink the internet?

WorldCom has plenty to think about right now but should everyone else be considering cutting back the commercial sector's role in running the internet? Martin Brampton thinks so... It looks as though WorldCom is passing on. Last week, we were discussing the breathtaking notion that the government should give money back to the now impoverished telcos that bought 3G licences. Now WorldCom draws attention to other weaknesses of commercial companies in the technology sector. I'm not thinking just of financial weakness. After all, not long ago, investors were falling over themselves to put money into companies such as Amazon who freely talked about making huge losses. And WorldCom was only at the extreme end of the presentation of financial results in the most favourable light. No, my concern is the fate of the internet. Forty per cent of internet traffic is estimated to pass over WorldCom facilities. If WorldCom's data communications links were closed down, the internet would cease to function. It does not have sufficient spare capacity to cope with such a huge outage. Yet, the internet was planned to be the resilient network that could survive nuclear attack. How can we have gone from a network that could survive massive destruction to one that is vulnerable to the financial shenanigans of just one company? The answer is linked to an issue that has been raised here before. That is the difficulty of sustaining competitive markets, especially in IT. Competition and free markets work very well in some sectors. If you want to buy a washing machine or a DVD player, there are numerous competing manufacturers. Prices and features offered are hotly contested and you are free to make your choice. But many areas of the economy, especially in IT, are not readily amenable to this formula. All too easily, a single company comes to dominate. Recalling the history of the internet, the network was created to prove the theory that a multiply linked network of computers could continue to operate in the face of major failures. For years, the internet developed primarily in the global academic community. Governments found the money to keep it going and the theory was proved sound in actual experience. When it became common knowledge that academics had a global network at their disposal, it was not long before everyone had to be admitted to the internet. All to the good, as we all became excited by the new opportunities. But governments wanted to stop paying, so they started to shift the burden to private companies. With the typical polarisation of the IT market, WorldCom eventually controlled nearly half the network. Governments, especially in developed countries, fail very infrequently. This is not true of commercial companies. In every economic downturn, despite their apparent wealth and power, some major companies collapse. So, while the internet has continued to be invulnerable to sporadic failures of equipment and circuits, it is now to be tested against the financial demise of the provider of much of its capacity. Ironically, it is quite likely governments had no need to hand over the internet to the commercial sector. The move was predicated on a prejudice and a misunderstanding. The prejudice is that commercial companies are more innovative and efficient than government, although the histories of organisations like BT and Railtrack do little to support the idea. The misunderstanding is the belief that governments are bound by the kind of 'housewife's purse' economics beloved by Margaret Thatcher. In fact, national economies are just a little more complicated. Some kinds of spending open to governments do not need to be matched by a charge. Education is one and transport infrastructure is another. Tolerably well directed spending on such things creates a sufficient boost to economic activity that government automatically reaps its reward. It is quite likely the internet is the same. If the government has enough spare cash to be contemplating money back offers to the 3G bidders, I would suggest a far more attractive alternative. Put the money into improving the internet and making it less dependent on individual commercial companies. Oh, and stop insisting on spying on everybody using the thing - but I'll save that for another time. ** Martin Brampton is a director and founder of Black Sheep Research (http://www.black-sheep-research.co.uk ), an independent consultancy providing research, writing and speaking services on a wide range of business and technology subjects. Martin was previously a director at Bloor Research, and has worked with IT as a user and analyst for over 20 years. He is a frequent contributor to silicon.com's Behind the Headlines TV programme and can be contacted at silicon@black-sheep-research.co.uk .