One of the fastest growing and hottest topics of discussion and activity on the Internet is commercial use of the network. Discussion lists far and wide are talking about "acceptable use" of the Internet, the rapid growth of business use of the Internet, what to do about it, and how to get on the bandwagon.
Questions like these are popping up everywhere:
These issues are addressed in this and the following chapters on the growth of business use of the Internet.
The number of Internet users is growing at the phenomenal rate of 10 percent a month! In addition, the business and commercial component is the largest and fastest growing segment of the Internet. The details are amazing and important to anyone interested in maintaining competitiveness in this age of global communications. Part I of this book discusses this growth in some detail, but the following section, as an executive summary, briefly recaps the important points.
Initially, the Internet grew slowly, but across time, it has grown to include more than 45,000 connected networks in more than 200 nations. Statistics about the Internet are almost always estimates because the numbers change so frequently.
There is a huge transition occurring with the Internet—it is in the midst of moving to a new structure, evolving from NSFnet to the National Information Infrastructure (NII). A couple years ago, the National Science Foundation sent out "NSF solicitation 93-52," calling for new components of a national backbone; contractors have been chosen to implement the NII.
The new scheme has no central coordinating authority; it depends to a large degree on the cooperation of regional and national telephone companies, academic institutions, businesses, and network providers. Officially, NSFnet ceased to exist on April 30, 1995, but several components of the "new system" are not yet online and the transition promises to be bumpy and more lengthy than planned. For businesses (and, to a lesser degree, all users), this means 12 to 18 months of some mild uncertainty about the network.
The Internet is currently made up of over 45,000 networks worldwide; depending on whose data you use, there are approximately 30 million people who have some kind of Internet connectivity. Broadly, the Internet includes individuals, groups, organizations, schools, universities, commercial services, companies, governments, and Free-Nets.
Network Wizards' DNS survey (put out by the Internet Society) reports that in the last quarter of 1994, the Internet experienced its largest growth in recent history—a rate of 26 percent—to 4.851 million hosts in more than 200 countries worldwide.
There are some interesting recent trends and statistics:
The Internet is a voluntary, cooperative undertaking, in which the conjoined networks have agreed on certain communication protocols regarding e-mail addressing, how packets are sent and received, and so on. Although there are groups and committees that work on this cooperation, in the end, no one body is in charge.
Although a network that joins the Internet becomes part of the Internet, it retains control and ownership of its own network. Control is therefore shared among the 45,000 networks currently connected to the Internet. The National Science Foundation has been a very influential part of the Internet, but this has never put them fully in control because networks can communicate directly with each other using other network systems.
Businesses joining the Internet find that this cooperative venture is very different from any other organization with which they work. The Internet has an unusual history, is not governed in the way other organizations are, and has a significant community culture of cooperation, sharing data, and providing services and information for free.
The commercial sector of the Internet (both .com and .net domains) is currently growing faster than any other sector. A year ago, .com became the sector with the most domain names; now it is estimated that it will have 65 percent of the domain names by the second quarter of 1995.
The Internet access marketplace alone in the United States now exceeds $1 billion in annual revenues, according to a recent survey conducted by the Maloff Co.
The data shown in Table 38.1, extrapolated from InterNIC and other data, compares the relative size of the commercial domain with government/military, education/research, and organizational/network domain registrations. This distribution continues to change each month, swinging towards the commercial domain. Every month, the number of unique commercial registered domains represented increases by 10 to almost 14 percent from the previous month.
Domain |
Percentage of Total |
|
Government/Military |
16.7 |
|
Commercial |
65.2 |
|
Education/Research |
7.1 |
|
Organization/Net |
11.0 |
Although the commercial sector of the Internet is the most rapidly growing sector, the Web has become the fastest growing protocol—and the Web is where business is spending its time these days.
In June 1993, there were close to 130 Web servers, but by November 1994, there were nearly 9,000 servers. According to Sun Microsystems (reported in Business Week, 2/27/95), current estimates are 27,000 to 30,000 sites, and the number is doubling every 53 days. Researchers at Carnegie Mellon estimate that there are more than five million documents stored on Web servers, doubling every six months or so. The Lycos index has indexed more than two and a half million individual Web addresses (URLs)—and remember that Lycos is an incomplete index. The majority of these sites and documents are related to commercial ventures.
You can access a humorous site to have a look at all the various Internet traffic and demographic data. The site is called the U-Do-It Internet Estimator, from GNN:
http://gnn.com/news/feature/inet-demo/net.measure.html
U-Do-It offers hotlinks to the data sources such as InterNIC, Texas Internet Consulting (John Quarterman), and others.
A group of businesses form the power users of the Internet. The commercial power users of the Internet are in a broad scope of industries, including high-technology manufacturers, computer-related industries, oil companies, pharmaceutical companies, healthcare-related industries, financial services, and banks. The growth in traffic from some of these companies exceeded 90 percent in the first quarter of 1995 compared to the preceding quarter. Based on figures from NSF and InterNIC, these are the top 10 companies using the Internet based on traffic volume and the number of externally reachable hosts:
LSI Logic Corporation
Bell Communications
Xerox Corporation
Dell Computer
Pyramid Technology
PSI
Honeywell Incorporated
Amgen Incorporated
Cray Research Incorporated
General Dynamics
Other power users of the Internet include Bristol-Meyers Pharmaceutical, Cadence Design Systems, Sterling Software, A.C. Nielson Company, Demon Systems, General Dynamics, General Motors, and Monsanto.
Not only industry giants use the Internet. Many small companies and individual entrepreneurs use the Internet through inexpensive access service providers such as netcom.com, pipeline.com, delphi.com, world.std.com, and PSINet. In fact, access services have increased and expanded rapidly in the last year. They provide a full range of Internet services to individuals and small-to-medium-sized businesses. Some commercial services such as America Online, CompuServe, and Prodigy now provide a limited variety of Internet services—and all have plans to expand that access.
Major financial institutions such as J.P. Morgan & Co., Lehman Brothers, Paine Webber, and the Federal Reserve Board have started to use the Internet. According to NSF, these companies are retrieving 10 times as much data as they are sending out, suggesting that they are using the Internet to support their financial research functions. The same is true for medical institutions. Companies such as Massachusetts General, Health and Welfare Canada, and Rush Presbyterian retrieve more data than they send out by a 10:1 ratio.
You can expect a number of influences and developments to have an impact on doing business on the Internet and the Web:
Don't be surprised by the business activity on the Internet. A few years ago, these questions were often asked on the Internet itself: "Can you do business on the Internet?" and "Are there any businesses on the Internet?" Now there are hundreds or thousands of Internet sites with their own .com (commercial) or .net Internet domain names.