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Summary:

Getting to gigabit networks isn’t a cheap proposition, and once they are deployed, they generally cost more than the average person can afford. This creates a chicken-and-egg problem around building applications that could help network adoption. Why build if there’s no audience?

running elephant

Getting to gigabit networks isn’t a cheap proposition, and once they are deployed, they generally cost more than the average person can afford. For example, a gigabit connection in Chattanooga, Tenn. one of several towns offering such a service costs more than $300 a month. Even if one can’t get a gig, even a 100 Mbps connection or so can cost about $120 or so. Which means that for most broadband supporters, even ardent ones such as myself, the elephant in the room is: Why spend that much, when for today’s applications, a cable modem offering 12-14 Mbps down will do just fine?

It’s a question that analysts posed of Verizon, when they pressed the company that deployed the nation’s largest fiber-to-home network, about take-up rates and boosting subscribers for FiOS. It’s a question Google seeks to answer with its own plans to build out a gigabit network in Kansas City, Kan. and Kansas City, Mo. And it’s also a question we need to focus more on even as the siren song of mobile connectivity and apps tempts developers to think smaller.

“It’s ironic that the app that is having the most effect and making a big difference is Twitter, which is the most narrow band application imaginable,” says Dane Jasper, CEO of Sonic.Net. “Something similar has to occur in broadband as it gets faster and faster and it gets more ubiquitous.”

Jasper’s ISP is overlaying fiber to the home in Sebastopol, Calif. where it already deployed an ADSL2 network. Subscribers can pay $40 a month for wireline voice and 100 Mbps FTTH broadband, or they can pay $70 for two lines and get a gigabit. Those seem more like the economics that Google is looking for when it sells its network, but until later this year when it should announce pricing, we’re still unsure what it plans to offer.

But tests from Jasper’s initial deployment speak to some problems the industry will need to overcome if we want gigabit networks to become the norm. For starters, there’s the equipment. Computers today aren’t geared up to support gigabit connections and current Wi-Fi networks couldn’t offer those speeds either. Jasper says the first trial of the gigabit network was a speed test on a generic laptop that showed off 420 Mbps down; the laptop couldn’t handle a full gig.

That’s fine, because there aren’t that many applications that need those speeds. Perhaps the most compelling use case I can think if right now is if you wanted to subscribe to a new online backup service and upload your images, music and movies all at once. A gigabit could help you complete the task in minutes as opposed to hours or days. But that’s a one-time kind of benefit — consumers will need everyday benefits if they are going to upgrade their broadband. Yet, network operators have a hard time justifying an investment in a network that will get few subscribers and application developers have little incentive to develop programs for the few on gigabit networks.

So we’re stuck at a point where a gigabit — or even 100 Mbps – sounds awesome, but it’s not exactly worth the prices most companies want (or need to charge). This is why Google’s and Sonic.Net’s plans to expand moderately priced 100 Mbps and gigabit networks will be so important.

“If every consumer has 100 Mbps, we’d have some better applications,” Jasper said. ” At 100 Mbps, high-def video conferencing becomes a reality and you don’t need local storage anymore. You don’t even need local computing.” He pointed me to this awesome video as an example of what might happen, ya’ know, just in case anybody wants to build those next-generation applications.

  1. Good article – I think there are a couple very interesting points here:
    1) Even with potentially unlimited bandwidth (and metered pricing), what is the equilibrium pricing/bandwidth point above which consumers will not go? I don’t think we know that yet, but we’ll soon find out.
    2) How fast is “fast enough”? For all the cheerleading that technophiles do for…LTE for example – what use case does it enable where bandwidth-inferior ones (HSPA+, WiMax) cannot?

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    1. LTE is better at penetrating building structure so that it can be used in doors. I have WiMax and wish it did better inside buildings.

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  2. Living and working in Silicon Valley, I can tell you that I wish I could get Gigabit bandwidth at that price. The cheapest option in Sunnyvale running Comcast’s 50Mbps/10Mpbs costs $189 + equipment rental per month.

    For the office, the prices are even higher. The question is, if they build it, will customers come? I think for certain parts of the country, the answer is yes. For others, well, we’ll have to see.

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    1. NHL Counterpoint Sunday, September 11, 2011

      Sunnyvale’s internet sucks, but don’t shoot down the entire SV. If you can find a subdivision/complex (usually Pulte built), you can find Paxio and get up to gigabit speeds from them.

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    2. That’s the real question. Getting regular consumers to think they need super fast connections is the only way any of the Telecos will be able to make money.

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      1. I’m not sure they can afford to think that way Jeff. Most think the way to make money is to charge more for new features on top of the pipe because they have huge workforces and infrastructure around content now as TV providers to support. Wide scale consumer adoption of gigabit networks at a cost that makes sense to a telco is probably too much for most consumers to want to pay.

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  3. Jeremy Zawodny Friday, September 9, 2011

    I used to think I wanted a high bandwidth connection but realized that above a few Mbit/sec, what really matters to me is latency.

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  4. One problem here is Sonic.net’s operation, while it works extremely well on a quasi-local basis, it doesn’t scale on the levels needed to reach the masses. Dane runs a very lean shop and is not a greedy bastard like VZ. Anyone lucky enough to live in Sonic’s limited footprint will be one of the ‘haves’, while most of us will have to suffer with limited broadband options or pay through the nose. Still very nice work by Dane and Sonic.

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    1. Oh Peter, wait until next week when I post on Dane’s operations based on the rest of this interview. He’s rethinking broadband, although scale will be slow.

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  5. “At 100 Mbps … you don’t even need local computing.”

    This is EXACTLY why Google is investing in broadband.

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  6. They have been demoing 4k plasma at CES for the past few years. Sony just announced consumer 4k projector.

    High quality video could be a driver for Gig networks. VC1 or AVC encoded ~2k bluray at 40 Mbps still shows artifacts. 4k would need roughly 150M just to be remotely comparable. If we want actual quality (deep color / 12bit) and reduced motion artifacts, then the rate mjst be higher. Try to ship high motion sports events at 4k progressive-60, and the rate goes up again. Most people have multiple sets in their house…

    The opponents of this are the studios (fear of piracy, loss of theater revenue) and the existing tv networks (fearing direct relationship between consumer and content originators will put them out of business; eg Youtube, Akamai and Level3 CDNs replace CBS, NBC and HBO).

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    1. The opponents are also service providers who are offering slower bandwidth at higher rates. I.E.; 10Mbits/$150USD

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    2. 4K is awesome technology and would be a huge bandwidth hog. But yes, we will get there eventually — just slower if the SPs have their way :)

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  7. Well, when they advertise 100Mbps or 1Gbps, how much really it is for the customer ? Eventually I would like to get a remote TiVO HD (1080p), I guess that I would need a solid couple of 10s Mbps to support that (BluRay goes up to 35Mbps but hard compressed a 8Mbps could do)… and if we want few more streams for the all household, a solid 100Mbps would be required, and that ‘s only for video in 1080p. 4K TVs are already coming, and we are only talking about receiving video here. I might want/need to video call in hi definition too. So, even with our current hardware at home we could easily consume over 100Mpbs.

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    1. I don’t understand this thread: physical hard drives will be obsolete by at the end of the year. Why don’t you think they ar SO cheap now and nothing over 2TB isn’t being massed produced?

      Let’s get real. Where there are bottlenecks in thw compendium of computing, the pursestring holders must let go of yhe reins and not in drips and drabs.

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  8. Well, if you’re thinking about video streaming or IPTV, OTT applications. suddenly 100mb starts to make sense.

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  9. What do you mean that computers today aren’t geared up for gigabit connections? All modern computers support gigabit. Even last year’s netbooks support 10/100/1000BaseT. The only systems that don’t support gigabit in my house are the cheapest motherboards from three generations back.

    In addition, almost everyone today shares their homes broadband connection. In my household of four, there are five hard-wired computers, two hard-wired blu-ray players and three wi-fi clients on any given day. If we’re backing up the computers to an online service while we’re watching streaming content on the two TVs, then we’re definitely starved for bandwidth.

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    1. I think the point was that the laptop’s HD couldn’t keep up with a gigabit download. This becomes less true when you fit 7200RPM drives to your laptop.

      I think they somewhat missed the point – in fact, the whole article seems to be based on a fictitious premise. More and more people *do* have equipment capable of writing data to storage at gigabit speed. I have a consumer grade 2TB SATA drive which is more than capable of writing 100MB/s and that is hooked up to a 5/6 year-old PC.

      If I had full duplex gigabit internet at home, I would be doing quite a lot with it. I would bring my websites home. I would host my own email. I would host game servers.

      It’s the same argument for businesses. I have the offer to pay £12K/year for 100Mb or £24K/year for gigabit. That’s just ridiculously expensive, but the advantages it would bring would be nothing short of revolutionary and would unleash a huge amount of efficiencies and opportunities.

      Perhaps an analogy to our current ‘miserly’ internet performance is to compare with the amount of CPU power and installed RAM we all had to suffer, not a mere 10 years ago. Software had to be written to be efficient and to creatively cut corners to get the job done.

      We have to cut a lot of corners to enable video streaming. Blocky, error-prone imagery with the odd “buffering… please wait” thrown in for good measure. That is how a lot of people experience their streaming video.

      Throw a decent sized buffer at a gigabit connection and you too might be able to enjoy full HD, 120Hz (i.e. 3D) video being streamed to your TV.

      Maybe it’s nice to be controversial and argue against gigabit internet, but it’s certainly not helpful and largely ridiculous.

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      1. Stefan, I’m not arguing against gigabit Internet, but I am concerned that today most consumers don’t see the value in connection speeds above 20 Mbps or so, which has obvious implications for how willing operators are to deploy it.

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      2. Yes but a laptop display and process CAN keep up with a HD video stream, not everything has to be written to disk, in fact i suspect that Hollywood would be very happy if they could guarantee that streamed data was not written to disk.

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  10. Planning for today’s bandwidth requirements is a sure way to stay behind the technology curve. Remember, it takes decades to deploy higher speed infrastructure. Are you sure you want to limit yourself to what a single laptop can consume now?

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  11. Just because one computer can’t use up an entire gigabit link doesn’t mean it’s too much. More and more households are getting internet connected devices and making use of them. I have two TV’s in my house that are almost always streaming Netflix. Combined with 2-3 computers turned on all the time the connection can go a bit slow at times. Unfortunately my area only offers up to 20 megabit.

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  12. 1. use good Intel based NIC instead of crappy Realtek and you should be able to approach ful Gig-E bandwidth.

    2. Don’t count on Wifi at those speeds. There are fundamental limits that won’t be overcomed soon. Don’t let PR bull**it mislead you.

    3. Even with all this, Gigabit is perfectly useable today.
    I have 100M FTTH and although it is awesome I would go for Gig in a heartbeat.

    It is rgeat thing if you can open remote file as if it was local on your disk etc.

    Also, streaming and various P2P networks can benefit greatly from good bandwidth.

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  13. The abbreviation for Missouri is MO, NOT Miss.

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    1. James, that was a typo on our part. It’s fixed, and thanks for pointing it out.

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    2. That was the copy editor’s fault, James. Stacey had the state correct. Thanks for the correction.

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  14. I have gigabit fiber (googles trial in Stanford faculty housing). In a fake test (using 2 pc’s hardwired to a gig switch), I was able to get 500mbps going by downloading from a bunch of services at once. But in practical scenarios, the user experience for 1gbps is about the same as 100mbps for a home or a small office. As another poster said, latency’s what matters for web surfing. And for downloads, Most inernet servers support 20-30mbps per connection, so it’s hard to consume a lot of bw.

    The real opportunity will be beyond-hd video streaming with unique programming per house ( as opposed to cable where everyone gets the same thing). But that won’t happen quickly – content licensing from major studios will be the bottleneck, not technology. (see netflix’s recent issues with starz)

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    1. Nice perspective, thank you!

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  15. Wow. When I read the title my first impression was, “What, gigabit gear is cheap, unmanageable switch just cost around $ 200, because I was thinking about using gigabit on LAN, but when it come to internet access then, wow. In Indonesia we can get 3Mbps ADSL for +- $ 180/month, or in Jakarta there are ISP that offer 20Mbps ADSL for $300/month with 60GB caps. I don’t even think about having 100Mbps or even gigabit connection at home or office :)

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  16. My Gigabit fiber subscription costs me around $49 (USD) a month in Japan, so it can be done. It’s just a matter how much the providers want to profit from the early adopters…

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  17. Time to move to Sweden? Unmetered Gigabit Internet with avg transfer rate of 400 Mbps (50 MB/s) anytime of day for under $100US/mth (up yours Comcast!). And let’s not forget universal healthcare, free university,Swedish women, and the local cuisine is improving.

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  18. John Homer H Alvero Sunday, September 11, 2011

    Say you want to download the latest kernel from kernel.org, can that server support 1G upload to a single IP? Even if you want start multiple threads I don’t think kernel.org will give you that much upload speed.

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    1. There are multiple kernel.org mirrors hosted on machines with gigabit connections to the host. They *easily* hit line rate on a single download.

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      1. Agreed Linus. It’s the cloud…

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  19. Yes a single laptop might max out at 400Mbps of data transfer, but it is still running at Gig speeds and getting the benefits of a faster transfer rate.

    Gig makes sense because its the rate the lines clocked at, so it transmits data quicker and you get shorter bigger peaks or bursts. This is great is real time traffic is also present as it has to queue less. So gamers, video calls, will all benefit. ow take a family with 3 teenagers all sharing/competing for that single link.

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  20. Small correction: Windows PC tends to top out at around ~400Mbps.

    A Linux system typically handles a full GE connection at line rate. I am sorry, but I have no stats on MacOS, but would suspect it to be closer to Linux than Windows.

    This is not a plug for Linux, but simply reflects an unstated assumption in your statistics.

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  21. I’m apologize for my bad English, but I want to say that price for Internet connection in USA is really expensive.

    I’m from Russia. For exapmle in Siberia my unlimited 6 Mbit connection costs about 11 USD. 20 mbit costs little than 20 USD. I have more than 5 ISP in building where i live and I can choose any provider and tariff.

    In Moscow 50 mbit costs about 38,5 USD and it’s expensive. You easily can find 50 mbit for cheaper price. Btw in Moscow you can use free Wi-Fi network from your neighbor in house when you live. For example my friend say pass from own Wi-Fi spot all neighbours in house and that people use him Wi-Fi totally free.

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  22. In Sweden, these connection speeds are not very expensive, I recently moved from a university dorm with 100/100 mbit for 12-15 USD/month to an appartment with 10/1 and felt absolutely crippled! I’ve now upgraded my connection to 100/10 which costs about 40-50 USD/month, where i could get 200/10 for an extra 10 which i felt unneccessary. My biggest grief with this however, is the lack of the extra 90 upstream speed, while seeding torrents my ping in online games sometimes shoots up. So while one computer might not cap the gigabit connection, the extra overhead secures that all applications will work at their best at all times, which really is something to strive for.

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  23. who are Jasper’s ISP? much cheaper than sonic.net, no? you can’t find 100mbps on sonic.net! is Jasper trying to say broadband doesn’t need to be fast or cheap because the ISP that he is CEO of, sonic.net, can’t deliver that?

    besides, its not like you’re using 1 old laptop alone. you can easily use up a 1gbps with 2-3 computers, a game console with netflix, and a internet enabled tv – all of them could be connected via wifi , sharing that 1gbps to the outside. getting a new router that would support 1gbps upstream is the easiest part of this equation.

    even if you live alone and have only a laptop connected to the internet, don’t have a netflix-enabled console and don’t watch tv, you only need to imagine not waiting to download a movie before watching it to appreciate why faster internet is a good thing. yes, you can wait for it to download and watch it later. but with internet that is 10 or100 times faster, you get instant gratification.

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  24. All I can say is, I cant tell if trolling or serious. Sure my one laptop on wifi (lets not even go to what it can pull when I put it on the good ol’ copper) cant saturate my gigabit, but my laptop, TV, Xbox360, PS3, Wii, Desktop, Tweeting toaster, self ordering fridge, etc together will easily saturate that. As we look into the future more and more is going to be interconnected and on the network and eventually on the internet, so sure one system can pull 480mbps but what if i have 50 systems in the place that all use 480mbps? You cant build infrastructure for now you have to build it for 10 years down the line.
    Its thinking like what comes from this article that has the US so far behind the rest of the world in internet speed, bandwidth, and cost…

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    1. Richard Whiffen Monday, September 12, 2011

      Jason hit it on the head. It’s my take too. Rarely is a single device in my house online. The aggregate of those devices together could easily reach GigE rates. On my existing broadband, iTunes HD Movie + Skype video = no joy. Building in anticipated future growth is essential. The last mile usually requires a truck-roll to the neighborhood and is usually your most expensive piece of the puzzle, so you need to ensure you have enough time to recoupe the cost before you have to do it all over again.

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  25. For Wan connectivity only your right. When it comes to LAN connectivity it’s painfully obvious that the author is a content consumer only. If you have any kind of network storage on your network (and most prosumers do these day) you need gigabit networking.

    Imagine this scenerio. 4 roomates one cable modem and 4 seperate NAS devices attached to a 100mb network. Roomate 1 is watching a movie streaming off of the NAS. Roomate 2 and 3 are playing a bandwidth intensive game. Roomate 4 is moving large files from their computer to the NAS’s and killing the 100mb bandwith on the whole network.

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  26. Let me just take a moment to note my surprise that Google, in addition to building a GB network in Kansas City, Ks. and Kansas City, Mo., has decided to also build a GB network in build out a gigabit network in Kansas City, Miss.

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  27. So much to comment upon here.

    1) The big driver for this can be called “The End of the Desktop”. With Gb networks, cloud-based storage becomes more feasible (forget backups, it will reside there already). And, “desktop” virtualization–via a Type-1 hypervisor-based thin client–will replace desktops and laptops.

    2) Engineering fiber networks to support DWDM to the demarc (home or business) will be critical. Combined with the virtualization mentioned above and high-def videoconferencing, this will enable more businesses to embrace telecommuting/telework and lower real estate costs.

    3) Twenty years ago, one application (NCSA Mosaic) drove the need for more bandwidth to the home. Ten years ago, music downloads/P2P networks drove it. Five-six years ago, streaming video started it’s ascendancy. Today, there are applications in the wings waiting for more bandwidth.

    4) Per packet metering has the potential to kill this off…and it’s coming.

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  28. Peter Reeves-Hall Monday, September 12, 2011

    Should reard “Why spend that much, when for today’s applications, a cable modem offering 12-14 Mbps down *AND 0.5-1.0 Mbps UP* will do just fine?”
    Which many of us have issues with.
    With 1Mbps up you have
    1)terrible video conferencing
    2) inability to stream even Netflix/cell phone quality video to your cell phone or tablet on the road from your home PC
    3) slow teamviewer/gotomypc performance on the road.
    4) VOIP fighting other house hold members for enough bandwidth to provide decent call quality etc.
    5) spend 2 minutes to download a large word document to work on and 30 minutes to send it back to a work partner?

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  29. Larry of Renton Monday, September 12, 2011

    Don’t most households have more than 1 computer nowadays. Now add to that online gaming from a console, blue ray players that can do Hulu, Youtube or Netflix, and ipad and tablets then I think you can take advantage of GB speeds.

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  30. I’m still going to have some local storage and computing facility – Internet connectivity is too fragile to depend upon 24×7. Right now when the connection is down (or slow) it’s just the web and e-mail; at least I can still fire up my word processor and get work done. Sorry, but ubiquitous high-speed Internet access is still something of a myth. It’s getting better but it’s not there yet.

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  31. Robert J. Berger Monday, September 12, 2011

    In 1980 few consumers knew what a personal computer was let alone wanted it.

    “I have to say that in 1981, making those decisions, I felt like I was providing enough freedom for 10 years. That is, a move from 64k to 640k felt like something that would last a great deal of time. Well, it didn’t – it took about only 6 years before people started to see that as a real problem.
    Bill Gates 1989 speech on the history of the microcomputer industry.

    In 1993 almost no consumers knew what the Internet was, let alone wanted it.

    In 2012, a Duopoly controls Internet Access in most of the US and is doing its best to make sure Americans will never experience a Gigabit to find out what they want from that.

    Its time to decouple Internet transport from people who want to control content and charge a toll for every byte even though the cost of delivering bandwidth is dropping faster than Moore’s Law.

    Divestiture Now! Get the BellHeads and CableButts out of the Internet.

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  32. Gotta say this is the most ridiculous perspective ever. I’m wondering if this is a plant or ploy to extend the horribly slow stuff being sold off the shelves for as long as possible to st as ll any new last mile developments or she is a backwards thinker.

    If you make the network faster then in a few months the industry will release just the very next version that will work with whatever protocol or speed is cutting edge.

    Gigabit networks are already here. It’s the cable companies and Ma Bell who are stinting the growth of faster more robust machines by hoarding current technology and dragging their heels on getting last mile gigabit to the home plus threatening local governments get fiber to the premise far faster than their marketing dept’s can walk across the street.

    If you think we will stand to wait for quad core smatphone be the end of 2012 then you’re in the wrong business baby.

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