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- 10 December 2012
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The utility value of capacity relative to cost.
That's a point I've heard someone else make.
I'd argue that it's only a recent development where cheap capacity is reaching the point where we can have the Internet the way we've always wanted it. previously there's been a compromise due to low connection speeds. As the majority of users have faster connections the complexity of web pages can increase. Maybe not always a good thing, but I remember the internet from the early 90s and it was a pain to navigate. Early web pages were quite dull and far less interactive than they are today.
The Southern Cross cable consortium are upgrading the equipment at both ends to double the bandwith currently available. Another upgrade will double it gain within the next year or so. The cost of increase, compared to the original cable install costs, is quite small. Similar cheap capacity increases will be common place now that 100Gbs / wavelength is hitting the market, with 40 to 80 wavelengths / fibre the ultimate end. Huwaweii has been trialling terabit transmission over a single fibre in China, so we've got a LOOOOOONG way to go before we really need to worry about laying much more cable in the ground.
All this means is that the cost of data transmission is on a downward slope because the amount of capacity available is able to increase faster than demand, and the cost of increase is much lower than the initial install cost of capacity.