[LINK] Internet dominated by 30 companies

Bernard Robertson-Dunn brd at iimetro.com.au
Wed Oct 14 09:05:41 AEDT 2009

Internet dominated by 30 companies
By Phil Muncaster
Oct 14, 2009 6:02 AM

Radical shift from connectivity to content.

The internet has undergone radical infrastructural and economic changes 
in the past two years, leading to the dominance of just 30 large 
companies, according to a major new study from Arbor Networks and the 
University of Michigan.

The two year-long research analysed more than 256 exabytes of web 
traffic across 110 large cable operators, transit backbones, regional 
networks and content providers across the globe, and found that 30 
"hyper giants" account for 30 percent of all traffic.

Arbor Networks said in the 2009 Internet Observatory Report that five 
years ago internet traffic was fairly well spread out globally across 
tens of thousands of enterprise managed web sites and servers, but that 
content today has moved to just a handful of very large hosting, cloud 
and content providers.

Craig Labovitz, the firm's chief scientist, said that half of internet 
traffic in 2007 was generated by between 5,000 and 10,000 companies. 
Since then, however, a major aggregation of content has meant that just 
150 companies are now responsible for the same amount of traffic on a 
daily basis, led by household names such as Google, Yahoo and Facebook.

Much of this is due to changing economics, the collapse of wholesale IP 
transit and the rise of ad-driven business models, he explained.

"The internet was all about connectivity, a mesh of networks connected 
together," said Labovitz. "It was very hierarchical, with money and 
traffic flowing upwards [to the tier-one transit providers]. But now 
content is more valuable than connectivity."

Another knock-on effect of this economic change is that, as well as 
consolidating content, large content providers such as Google are 
establishing direct relationships with consumers, bypassing traditional 
tier-one providers.

The Arbor report also highlighted how internet applications have in 
essence migrated to the web. Previously there were almost as many 
application-specific protocols and communication stacks as there were 
developers, but today most have moved to a small number of web and video 
protocols, one of the most notable being Flash.

"The first 12 years of the internet was all about getting homes and 
businesses connected. That was the technology and that was the story. 
Now connectivity is ubiquitous and prices are falling and the innovation 
is happening not there but in content - getting it closer to the 
consumer and business," said Labovitz.

"As content is getting faster and better quality it will change the face 
of the internet, which is exciting for enterprises and consumers. We are 
entering the second era of the internet."


Bernard Robertson-Dunn
Canberra Australia
brd at iimetro.com.au

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