Google, YouTube, and the future of Web video

Google has been buying up unused dark fiber from the telcos for pennies on the dollar. According to Robert X. Cringley, they now own or control more fiber bandwidth than any company in the world. So, what are they going to do with all this bandwidth? See my earlier posts Google data centers and dark fiber connections and Google dark fiber mystery for what I think is happening.

Those stories were written over a year ago. Google has bought a ton of fiber bandwidth since then. They also bought YouTube, the biggest web video site in the world. All those iPods, Zunes, and iPhones want video, not to mention the more than 1 Billion YouTube videos that get downloaded every day. This takes bandwidth...lots of it.

Robert X. Cringley says "Looking at this problem from another angle, right now somewhat more than half of all Internet bandwidth is being used for BitTorrent traffic, which is mainly video. Yet if you surveyed your neighbors you'd find that few of them are BitTorrent users. Less than 5 percent of all Internet users are presently consuming more than 50 percent of all bandwidth. Broadband ISPs hate these super users and would like to find ways to isolate or otherwise reject them. It's BitTorrent -- not Yahoo or Google -- that has been the target of the anti-net neutrality trash talk from telcos and cable companies. "

Back in 1999 - 2000 when I was at Napster we accounted for an enormous percentage of bandwidth being used by colleges and universities. That was peanuts compared to what BitTorrent video downloads use.

Think ahead 5 years or so. All those videos you rent from NetFlix and Blockbuster...will be delivered over the Internet to DVRs and digital media centers in your home. YouTube might become your provider of pre-recorded TV shows, sports events, and full length movies.

Having big data centers strategically placed all over the country, and lots of fiber bandwidth to tie them together, looks like a pretty smart move right now. It will be brilliant...and very profitable in the future, especially if the telcos kill Net Neutrality.

Then there is the future of computing in the cloud. Today companies are delivering Software as a Service (SaaS) applications to thousands of users. SalesForce.com is one small example. In the future lots of software applications and services will be hosted in the cloud and delivered to your browser. This will take bandwidth too. It is not too surprising that stocks like Akamai and other Content Distribution Networks (CDN) have skyrocketed over the past year.

All this points to a coming shortage of high speed bandwidth, and potentially higher prices. Now does buying all that dark fiber bandwidth make sense?

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Comments

[Louis Gray]

Google is certainly planning ahead for the next stage of the Web. As we saw a migration from dialup to broadband, and ever faster Internet connections are becoming commonplace, consumers have higher expectations for their information and entertainment.

While we once blanched at downloading a 4 MB Netscape 1.0 browser release, we now don't bat an eye at hitting up BitTorrent for 1.3 Gigs worth of unreleased 24 episodes. The game is changing, and those companies who are fighting today's battles with yesterday's technology are going to disappear into the vault of antiquity and irrelevance.

[Ewan]

I think a part of it is certainly going to be the net neutrality debate. I can imagine almost every ISP in the world thinking they'll be able to tag on their own traffic charge to google's network costs, so anything which will either give them leverage over the ISPs or if neccessary bypass the ISPs will help Google greatly.