Anyone who claims future demand is limited, saying "nobody will need more than...", hasn't understood the past and the very many failures exactly this thinking has wrought.
The NBN was forced on the public sector because the private sector, specifically Optus and Telstra, failed to do anything for the last decade.
At home, I got my last speed upgrade 10 years ago. My first ISP connection was in 1995 by dial-up modem at 28.8kbps. Around every 2 years, I stepped up to the next speed available: 56kpbs (dialup), 512kbps, 1.5Mbps and then the limit of ADSL (3-5Mbps) for my 3.3km from the exchange on old & noisy copper. ADSL2, when it came, gave me nothing but grief and no speed benefit.
I'm pretty much the median distance and in the majority urban situation: nothing but Telstra. Although I'm lucky, this year TransACT is being upgraded by its new owners, iiNet to better than 50Mbps. I might reconnect...
Here's a potted, and highly unreliable, History of Computing. It doesn't include Gaming or Games Consoles, which have driven consumer demand more than anything.
- 1941: First electronic, programmable computer, Colossus, built to crack German codes.
- 1951: First commercial computers available. Not transistor, but "vacuum tubes".
- Cards and paper-tape first used for permanent storage.
- Large Accounting and Inventory system most common uses.
- Internal storage, RAM (Random Access Memory), is problematic.
- 1961: First line of computers, IBM 360: transistors. 1956, IBM RAMAC, first disk drive.
- Magnetic Tape arrives: fast and very large.
- "Magnetic Core Memory" used as RAM. Faster than any CPU, caches not needed.
- "Drum", not Disk, storage is both "Fast" & "large" (100M char)
- Programs laid out by hand in "overlays", "swapped" to 'backing store'.
- Banks and large Government Agencies
- In the 1968 the NATO Conference on Software Engineering notes "There are 10,000 computers in Europe".
- 1971: Terminals, minicomputers with integrated circuits and semiconductor memory, Unix, C, IP networking.
- All banks develop and depend on computer systems for back-office functions.
- Most large businesses have embraced "Data Processing" for Accounting & Billing.
- MOS transistors in chips start to replace Bi-Polar transistors (mid-price, mid-power, mid-speed) while highest speeds in Super-Computers are ECL (Emitter Coupler Logic) & very high power, hence very hot.
- 1981: Microcomputers on desks: IBM PC, single-chip CPU's. Internet: e-mail, FTP, News.
- Relational Databases and SQL takes over in back-office systems.
- Motorola 68000 picked up by Macintosh, used in cheap Unix systems.
- Low-power CMOS enters use for microprocessors.
- High-power ECL use wanes.
- CPU's become faster than RAM, larger & more complex caches needed.
- Virtual Memory becomes standard on mini-computers as well as mainframes.
- Microprocessors get VM with Motorola 68000 in Macintosh, later in PC's with Intel 486.
- DRAM, Dynamic RAM, becomes the norm for storage. Japan outs Intel as dominate supplier.
- Capacities rise quickly, hitting a production block with 256K chips: no "fault-free" chips possible due to micro-defects & production variations.
- 1991: Intel 486: First full computer-on-chip for PC's, Windows 3.1.1 with GUI and reliable networking. Ethernet LAN's, File Servers, RAID storage. IPv4 adopted (32-bit addresses).
- 10Base-T, or 10Mbps Ethernet over Twisted Pair became ubiquitous for LANs in the early 1990's.
- It was superseded by 100Base-T and 1000Base-T (gigabit) within 10 years.
- The Web, HTTP and HTML, and first Browser & Web server created at CERN in 1989-1991, included in a hypertext conference in 1992.
- Only Universities and large organisations were "on the Internet" until 1996 and the advent of ISPs (Internet Service Providers).
- Large Organisations, Banking and Government, had fully digitised their back-office operations.
- Medium Enterprises were investing in Unix, File Servers and other systems like the IBM System 3, 34 and later AS-400 for accounting.
- Small format Gigabyte drives arrived in the mid-1990's.
- CD-ROMs stored 650MB in 1991, compared to 30-100MB of PC disks.
- Following record profits every year since 1965, IBM makes largest losses in US corporate history in 1992 and 1993. An outsider CEO is brought in and the company survives.
- 2001: The Dot Boom investment bubble, with the Dot Bust financial collapse was intertwined with Y2K (the "Year 2000 Bug")
- Critical enablers for portable players, digital cameras, smartphones, ultra-thin/small portables:
- LCD displays and later OLED (Organic Light Emitting Diodes)
- Flash Memory (Solid State Drives)
- USB 2 (Universal Serial Bus, v2. 400Mbps)
- Low-power 32-bit ARM CPU in Ghz and later 64-bit & multi-core versions
- WiFi (802.11) LAN's and Bluetooth.
- Single Processor CPU's hit "Heat-Wall" in 2003, end of first run of Moore's Law.
- DRAM hits scaling limit in 2005, sizes and price/bit plateau, from
- Flash memory for SSD & memory/USB devices, continues to halve in price every year.
- Windows 2000, later XP, creates a reliable PC platform.
- Active Directory allows Enterprises to scale past 100,000 desktops & servers.
- Al Gore promotes "broadband" (always-on, fast) in "The Information SuperHighway"
- Home PC ownership was high and Internet access common and increasing.
- Home ADSL broadband at 256kbps to 1.5Mbps increasingly common.
- Jim Gray first observed in 2002 "Tape is Dead, Disk is the new Tape" on the rise of "Flash Memory" for storage, SSD's: Solidstate Storage Device.
- Large Enterprises now were dependent on computers, networks and servers/mainframes for Front-office and Back-office functions.
- Small businesses were increasingly using PC's for Accounting and running operations.
- laptop sales overtook desk-based PC's around 2005.
- International data traffic from Australia exceeds Telephony around 1998.
- Google and Yahoo! are the up-start Internet companies
- Microsoft is almost the most valuable company in the world and bigger than GM.
- Virtual Machines popularised on Intel, first on servers, then Workstations, then Desktops/Laptops. VMware first major Intel/PC Vendor, Parallels for OS/X.
- 2011: Smartphones, Tablets, Solidstate storage (disks and USB), low-power ARM CPU's dominate appliances. Email has replaced Faxes.
- G3 & G4/LTE mobile phone networks with 50Mbps+ raw channel bandwidth
- Massively parallel, high-power GPU's (Graphical Processing Units) become norm.
- Real-time high-def, high-speed lifelike rendering becomes the norm.
- CGI, Computer Generated Images, is commonplace in films, video and animation.
- Gaming enters new "realistic view" era.
- Heavy, large CRT (Cathode Ray Tube) replaced by thin, light LCD displays
- very large format (30-inch+) and multiple displays become common
- "retina displays" and 16:9 aspect ratios arrive in small & large formats.
- Social Media, Twitter and Facebook, arrived in the early 2000's, they are not yet a decade old, but had been part of everyday life.
- The iPhone arrived in 2007 and redefined the smartphone market, even though Microsoft and partners, like H-P, had been selling comparable Win-CE devices for nearly 10 years.
- The iPad followed in 2010.
- We're due for another Big Apple Idea in 2013.
- Google released the Free Open Source Android operating system in 2008. The largest selling platform.
- Global PC's sales decline around 2012, picking up speed on the way down.
- DVD's and Bluray exist, but are largely replaced by USB memory sticks or
- Low-end digital cameras are increasingly replaced by smartphones.
- High-end Digital SLR's start to outperform 35mm film cameras.
- HD movies and Television is increasingly filmed with DSLR's.
- 2k and 4k digital cameras arrive.
- IBM is still selling mainframes compatible with the 1962 IBM 360-series, more "instances" are running every year in VM's, though the number of Datacentres is in decline, hardware sales are strong and development continues apace.
- Apple becomes world's most valuable company for a time.
By the end of 2010, the computing market had evolved and segmented into many niches. A non-exhaustive list:
- Safety Critical control systems: Aviation, Medicine, Nuclear, ...
- Supercomputer systems: CGI, GPU supercomputers: simulations & financial modelling, Massively Parallel Clusters for Research: Physics, Nuclear, Genomes, ...
- Embedded devices: watches, fridges, washing machines, car systems (engine mgt/ignition, braking, ride, driver info,...), autonomous model aircraft & "First Person View" flying (real-time video feed to pilot), ...
- Mobile devices: smartphones, tablets, media players, GPS's, ...
- User Computing:
- small low-power "ultra-books" & netbooks
- laptops, ultra-thin to high-power desktop-replacements. Self-powered with batteries.
- Desktop Computers (not to be confused with GUI Desktop). No batteries.
- Workstations, high-performance single-user, multi-displays.
- Server Computing
- low-end (Department Servers, File & Print) in small & medium enterprises
- High-Density Enterprise Servers, SMP Multi-processor, "blades" and other servers
- Virtual Machines are nearly ubiquitous in server rooms.
- RAID has become "Storage Arrays" connected by SAN's (Storage Area Networks)
- ISP's and web-hosting companies adopt 1RU and commodity servers
- Cloud Computing:
- Small and large scale vendors offer "computing in the cloud" and Software As A Service.
- Multiple free Cloud Computing standards and toolkits arise.
- Enterprises adopt VM vendor software for "Cloud" services.
- Web-scale Datacentres for Amazon, Google, Facebook, Yahoo! arrived around 2005.
- Amazon is only major vendor to resell infrastructure and opens its cloud software to clients.
- use 10-30MW, up to 100,000 "servers" per datacentre.
- run purpose built computing and networking hardware based on commodity chips as well as in-house systems software.
Interestingly, the highest growth in productivity of the Australian economy was the 1990's, the decade of the office-PC, email and later Internet & web surfing. Nobody has proven a link, though the Productivity Commission came close around 2002/3.
Nicholas Carr in 2003, followed this theme with "I.T. Doesn't Matter", meaning computers & I.T. were no longer an advantage for companies.
Neither predicted the iPhone in 2007 and the massive impact on how we live our lives and communicate.
If you think that we've reached anywhere near the end of The Computer Revolution, looking at the history of computing should tell you "The only constant is change, Surprise is the Norm."
If you think like Solow and Carr that PC's and I.T. in general are mere fluff, frippery and a wasteful indulgence, try this Thought Experiment:
- Try to live 7-days without any Internet connected devices.
- No phones, no email and no Internet Banking.
- For extra credit, no credit cards or ATM's.
- Imagine for medium and large businesses and government, turning off the Internet.
- How long could banking or government operate with Computers and Internet?
- How quickly would they cease to function and send everyone home?
- With only 1965 technology, what fraction of Government operations could be performed?
- At what cost, with how many staff?
So while I can't give you a definitive research reference, each of us can reflect on their daily, personal experience and the impact of computing and Internet. While nobody can give you a figure for what the Internet is worth to the Australian economy, I've heard nobody argue that turning it off would be a positive.
Our modern lives are becoming increasingly dependent on, and run by, computing appliances, Internet and some mobile connectivity. There are no signs of the rate of change diminishing and the revolutions ceasing.
We are yet to see Apple make good on their promise to "reinvent Video", as they had done with iPod/iTunes for music, iPhones for computing and iPads for document management. Amazon's Kindle beat them to the electronic book market.
Netflix already accounts for one third of the nightime peak-hour Internet traffic in the USA. CISCO's VNI is predicting a 16 month doubling period for Internet video traffic (66% CAGR), or ~200 times in a decade.
From overseas experience, we know that IPTV and Internet Video is yet to start its real impact here, let alone fully play out.
Has anyone else noticed that 4K TV's are now appearing on the shelves for sale? There is no radio broadcast spectrum to support them, but right now, they can be fed, easily, over fixed-line Internet.
In 5-7 years, we can expect "Home Theatres" centred around 4K TV's connected to the Internet. The CISCO VNI prediction may turn out to be low for us. Australians have a long history of being enthusiastic early adopters of technology.