The high tech bubble was inflated by myths of astronomical Internet traffic growth rates. Yet although these myths were false, Internet traffic was increasing very rapidly, close to doubling each year since 1997. Moreover, it continues growing close to this rate.
This rapid growth reflects a poorly understood combination of many feedback loops operating on different time scales. Evidence
about past and current growth rates and their sources is presented, together with speculations about the future. The expected rapid but not astronomical growth of Internet traffic is likely to have important implications for networking technologies that are deployed and for industry structure. Backbone transport is likely to remain
a commodity and be provided as a single high quality service. It is probable that backbone revenues will stay low, as the complexity, cost, and revenue and profit opportunities continue to migrate towards the edges of the network.
There are repeating patterns in the histories of communication technologies, including ordinary mail, the telegraph, the telephone, and the Internet. In particular, the typical story for each service is that quality rises, prices decrease, and usage increases to produce increased total revenues. At the same time, prices become simpler. The historical analogies of this paper suggest that the Internet will evolve in a similar way, towards simplicity. The schemes that aim to provide differentiated service levels and sophisticated pricing schemes are unlikely to be widely adopted.