When you consider cell phones, cable, internet access...who much do you think the average US family of four spends on what is now being called "bandwidth"? Several hundred dollars? A few hundred at least?
Monthly cost of bandwidth may actually compete with the monthly cost of heating oil and gasoline for vehicles. A thought-provoking NYTimes article entitled OPEC 2.0 seems to think so.
This is not surprising when you consider how it is that all that data gets pushed and pulled through the wireless and wired infrastructure. Electricity is still generated by coal and oil for the most part. So T. Boone Pickens and others like Al Gore who want radical reform in the electric utilities, definitely have the right idea. New products that make better, more effective use of bandwidth or reduces the need for it may be as important as alternate fuels in the near term.
The take-away thought here is: why is it that the cost of bandwidth has not skyrocketed along with gas and overall energy costs?
For one thing, server rooms across the globe have been, over the last five years, really focused on lowering their costs. Energy efficiency has been a big deal for hard drives, rack servers, CPU's, laptops...just about everything for years now. The tech sector is also very price conscious and competitive, as well. When you consider how little real innovation there is in the packet delivery system (cable, etc) to your home, the cost of bandwidth has been amazing stable, really.
Then why aren't the utility and car companies doing the same thing as tech and bandwidth companies?
This is really at the crux of Al Gore's 10 year challenge to have zero-carbon electricity. In the tech sector, when the number of users goes up, the price comes down because technology can almost always be optimized. The inverse is true of oil and gas.
The price for a barrel of crude just came down $24 because Americans stopped driving for the last month. Isn't that backwards?
Ok, so the oil, utilities and car companies don't want to change and become tech companies. Fine. You know what? People are going to stop driving.
Check out how many banner ads you see for GoToMeeting these days. How may companies are switching to a four day week with a day working from home? Folks are looking at making money from their home offices now. It's the new American dream.
Q: What do you want to be when you grow up, son?
A: An internet tycoon with a hot blog, dad.
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