The US telecommunications company AT&T is claiming that the Internet’s network structure will reach full capacity by 2010 unless there is a significant investment in expanding the current network architecture. AT&T is blaming increasing amounts of video and user generated content, noting that the current Internet network structure cannot continue to support the huge bandwidth demands of streaming high-definition video and other user content — unless steps are taken now to expand the Internet infrastructure massively.

Of course, we’ve all heard these “the sky is falling” type comments before regarding the Internet. Back in 2002, one respected IT analyst suggested that by 2006 the Internet would “crash” because of the exponential growth of streaming video online. So should we take AT&T’s warnings seriously, or is this just another scare tactic to get increased government funding to benefit the giant telecommunications companies?

Actually, there may be some truth to AT&T’s claims, though it appears they are also exaggerating the projected bandwidth requirements somewhat. For example, an AT&T spokesperson quoted on Zdnet.com claims that in only three years, 20 average households in the US will generate more online traffic than the entire Internet today.”

While it is certainly unquestionable that bandwidth requirements will continue to grow, the idea that 20 households will generate more online traffic than the entire Internet today is patently absurd. Let’s face it, 20 households could each contain 20 computers, uploading high-definition video’s 24 hours a day, and still not come close to the amount of bandwidth currently used in a city like Tokyo, much less the entire world!

So it appears that AT&T is exaggerating matters somewhat, but beneath their hyperbole is a legitimate complaint, and it is that Internet bandwidth demands are growing at an exponential rate, and steps will need to be taken to ensure that the underlying architecture of the world wide web can stand up to the increasing demands for bandwidth.

An AT&T spokesperson stated that a minimum $55 billion investment would be required to add and improve the existing net infrastructure in the United States alone over the next three years. AT&T predicts the worldwide upgrade would cost in the neighborhood of $130 billion.

Realistically, AT&T is overstating the issue, and most experts believe demand for bandwidth is likely to continue to grow at the current rate, so there are serious doubts as to whether their 2010 projection is correct. However, nearly all Internet analysists agree that there will come a point when the capacity of the Internet’s current architecture “peaks out” and no further development will be possible until the system is expanded. Right now, a more accepted projection for when this will occur seems to be between 2016 and 2018.

There have been rumors circulating for years that it is possible the entire Internet could “crash,” crippling commerce and communications worldwide. While most experts have dismissed these rumors as blatant fear mongering, in recent weeks it appears that the Internet did indeed suffer a kind of “partial crash,” affecting both the Middle East and the Indian subcontinent.

India in particular, was hard-hit by the Internet “black-out,” which affected the country’s sizable outsourced services industry, web hosting companies, and other high-tech commerce.

Experts blame the two continents’ Internet outage on a pair of undersea cables that appear to have been damaged late last month. The cables, which handle most telecommunications between Europe and the Middle East, run along the ocean floor between Alexandria in Egypt and Palermo in Italy. The cause of the damage is not yet known, though terrorism is not suspected at this time.

CNN reported that an official from Egypt’s Ministry of communications believes a boat anchor may have damaged the two communication lines, causing the Internet slowdown.

The outages affected most Middle Eastern countries including Egypt, Saudi Arabia, Qatar and Kuwait. Israel, however, was not affected by the outage, as they use a different Internet traffic route. Both Lebanon and Iraq were also unaffected by the fluctuations and Internet slow-down.

In India, there were concerns that the Indian National Stock Exchange could have been affected by the Internet outage. And other communications methods were affected by the outages as well. There were major disruptions in television and telephone services throughout much of India and the Middle East.

Dubai was particularly hard hit by the Internet slow-down, with officials claiming the incident “will have a major impact on our voice and Internet service.” Dubai is notoriously cutting edge when it comes to Internet technology, and the country is easily the most technologically savvy in the Middle East.

Still, even the most progressive and technical minded nations — like Dubai — were affected by the damaged lines and a slowdown in Internet and communications services. Dubai’s business center, which handles billions of dollars of transactions on a daily basis, was also affected.

Luckily, there was only low to moderate activity within the Dubai stock market on that day. If the outage had occurred on a day of heavy trading, the communications problem could potentially have been crippling to the market itself, as well as to hundreds of trading companies who rely on instant access to information in order to buy and sell stock for their clients.

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