George Gilder and the promise of the telecosm

By Arthur Gingrande

"The central paradox of the information age [is that] while production systems of the industrial age use scarce resources, such as land, labor and capital, to create abundance, production systems of the information age use abundant resources, such as bits and bandwidth, to create knowledge scarce enough to fit the bandwidth of humans." -- George Gilder, in George Gilder Meets his Critics

Former Reagan speechwriter, high-tech guru and Knowledge Management Expo keynote speaker George Gilder may be a contrarian's contrarian, but it pays to bet on him. Over the past 10 years, he has successfully predicted and charted the emergence of network-centric computing, the ascendancy of the Internet and the paradigm shift from microcosm to telecosm.

Along the way, Gilder successfully persuaded Bill Gates to change his opinion about where the entire PC industry is heading, while revealing contemporary computing applications' prime mover to be bandwidth. In fact, Gates, who once violently disagreed with Gilder, commented in a fairly recent piece about Gilder and his critics that "in any case, Gilder is very stimulating even when I disagree with him, and most of the time I agree with him."

Gilder's vision of the telecosm, while controversial, has proved true over the past five years, forcing many of his critics to eat their own words--in some cases literally. Critic Bob Metcalf, inventor of the Ethernet card, because he lost a bet about telecosmic innovation with Gilder, ended up actually eating a copy of his critique in front of an audience of technophilic Gilder fans.

George Gilder may seem godlike to his industry peers, yet most EDMS vendors and users alike draw a blank when his name is mentioned. Let it be known that the EDMS community's notorious myopia notwithstanding, Gilder's revelations about the telecosm and broadband communications are as important as Jeffrey Miller's insights into successfully crossing the chasm.

Microcosm vs. telecosm

According to Gilder, broad bandwidth can make up for a lot of things, such as switches, speed and memory. When asked what advice he has to offer software vendors, Gilder's message is that "in general, your product development should be based on the premise that bandwidth will become a commodity in the near future. If it is not, your product is marked for extinction." Understanding that statement is the key to understanding Gilder's telecosmic vision of the future.

Remember the fearful speculation a while back that network traffic on the Internet would slow the speed of communications to a crawl, eventually bringing it to its knees? Funny thing: The Internet seems to be getting faster all the time, with no sign of a letdown. Part of the reason why is what Gilder attributes to the difference between the microcosm and the telecosm. The microcosm is the internal world of the PC, with its transistors, wires, boards and chips, while the telecosm is the world of the "fibersphere"--fiber optic cable networks, including Internet applications.

Moore's Law and the Law of the Microcosm guarantee that the number of transistors on a chip doubles every 18 months, and cost/performance rises as the square of the number of transistors. As Gilder puts it, "The complexity sinks into the microcosm and power rises exponentially on the chip to absorb all the complexity grenades rolling down from Redmond." He concludes, "Bill Gates travels in the slipstream behind Moore's Law, following a key rule of the microcosm: Waste transistors. Wasting transistors is the law of thrift in the microcosm, and Gates has been its most brilliant and resourceful exponent."Now, if the Internet were microcosm-based, the friction and energy loss created by all of those electrons bumping into each other through wires and switches would indeed slow information flow. But the infrastructure of the Internet is ideally composed of fiber optic cable. (At least it will be, once the phone companies unleash the awesome power of thousands of miles of the fiber optic cables already in place.) Information travels through the photonic fibersphere at the speed of light, in wave form, in a frictionless environment.

In the telecosm, there are no electrons, there are no cumbersome electronic switches to slow things down--just lots and lots of digital content and address information streaming at virtual light speed through big "stone dumb," unpowered glass pipes that use passive splitters and couplers instead of switches. The more network nodes the merrier. More pathways mean that information has a greater chance of reaching its destination--and faster, too.

Bandwidth, the new commodity

The telecosm contains an abundance of something that is scarce in the microcosm: bandwidth. The information transmission capabilities of the fibersphere are truly mind-boggling: The bandwidth of one optical fiber thread less than the diameter of a human hair could carry more than 2,000 times as much information as all the frequencies currently used for radio, television, microwave and satellite communications combined.

Despite Moore's law, software bloat is the rule in the microcosm, and there, individual PCs get bogged down in swamps of software complexity--to which any user of MS Office 97 will attest. But the telecosm produces gains that increase exponentially in proportion to the number and power of the machines on the network--almost limitlessly.

Gilder's telecosmic vision can be summarized as follows: (1) Networks always grow; (2) Networks always become more complex; (3) Networks always find applications that double the bandwidth needed every three years; (4) Broad bandwidth in dumb "dark fiber" solves all problems of memory, storage and transmission speed; and (5) The cost of bandwidth is artificially high and will continue to drop, descending to commodity levels. If the rule of the microcosm is "Waste transistors," then the rule of the telecosm becomes "Waste bandwidth."

The latter assumption is supported by the fact that the cost of a T-1 line (1.54 megabits) coast-to-coast in 1985 was $40,000 per month. Today the cost is $ 2,000 per month, a drop of 95%. Even as we speak, cable modem companies like Media One Express are offering a T-1 near-equivalent line, Internet connection and homepage as an add-on to cable TV services--all for only $39 per month. This certainly follows Gilder's vision of bandwidth as a commodity--good news for vendors of broadband applications such as imaging, workflow and teleconferencing.

Inquiring minds should heed Gilder's proclamation: "No matter how much memory and other storage is created on the desktop, no matter what information resources are assembled on CD-ROMs, no matter how powerful are the database tools created for the LAN," he insists, "the desktop imperium will pale and wither before the telecosmic amplitudes of the Internet."

Arthur Gingrande is a principal of Imerge Consulting (Arlington, MA, http://www.imergeconsult.com), phone/fax 617-646-7125, E-mail arthur@imergeconsult.com.