Development of the Internet & Service Providers

The Internet was the result of some visionary people in the early 1960s who saw great potential value in allowing computers to share information on research and development in scientific and military fields.

Howe, W (1998) A Brief History of the Internet
http://www0.delphi.com/navnet/faq/history.html (January 28th, 2000)

History of the Internet

The Internet has had a relatively brief but also explosive history over the last few decades. It originated from an experiment, started by the U.S. Department of Defence during the 1960s. The Department of Defence wanted to create a computer network that would continue to function in the event of a disaster, such as a nuclear war.

The network that eventually was created became ARPANET (Advances Research Projects Agency Network), which was designed to be able to function even if part of the system was damaged. ARPANET originally linked U.S. scientific and academic researchers across the country. This network was the forerunner to the Internet as it stands today.

In 1985, the National Science Foundation (NSF) created NSFNET, which was a series of networks for research and education communication. These networks today provide a major backbone communication service for the Internet.

As the Internet became more popular with higher recognition across the world, other networks started appearing that allowed the Internet backbone to grow considerably in a short period of time.

NASA and the U.S. Department of Energy contributed additional backbone facilities in the form of NSINET and ESNET while Europe implemented major international backbones such as NORDUNET and others providing connection to over one hundred thousand computers on a large number of networks.

During the course of its evolution towards the 1990s, the Internet began to integrate support for various protocol suites into its basic network structure. This basically meant that many different networks that spoke a “Different Language,” could use their language or protocols on the Internet and therefore connect to many foreign networks that was never before possible. This has evolved over the years into the Open Systems Interconnection (OSI) which has allowed the Internet to grow at an increasing rate through the merging of many different types of networks.

The development of the Internet originally came about through private networks but later led onto the development of commercial products implementing “Internet Technology.”

Towards the early 1980s, many vendors of computer networks were incorporating TCP/IP (Transfer Control Protocol / Internet Protocol), which was the basic protocol that allowed the Internet to communicate with many different systems.

During the evolutionary period of the Internet services such as Email and FTP (File Transfer Protocol) became standardised resulting in it being a lot easier for non-technical people to use these services.

The dream behind the Web is of a common information space in which we communicate by sharing information. Its universality is essential: the fact that a hypertext link can point to anything, be it personal, local or global, be it draft or highly polished. There was a second part of the dream, too, dependent on the Web being so generally used that it became a realistic mirror (or in fact the primary embodiment) of the ways in which we work and play and socialise. That was that once the state of our interactions was on line, we could then use computers to help us analyse it, make sense of what we are doing, where we individually fit in, and how we can better work together.

Berners-Lee, T (1999) The World Wide Web: A very short personal history
http://www.w3.org/People/Berners-Lee/ShortHistory (January 28th, 2000)

1989 saw a significant milestone in the development of the Internet as Tim Berners-Lee and others at the European Laboratory for Particle Physics proposed a new protocol for information distribution. This new protocol became what we know today as the World Wide Web or WWW in 1991. In 1993 a graphical Browser was developed by the name of Mosaic which was written by Marc Anderson and his team at the National Centre For Super Computer Applications (NCSA) which gave the protocol its large boost in popularity.

Later Anderson moved on to become the brains behind Netscape Corporation, which produced the most successful browser and server until Microsoft began to develop its Internet Explorer browser as a direct competitor.

The Internet was originally funded by the government and therefore was limited to research, education and government uses. It wasn’t until the early 1990s that independent commercial networks began to grow which eventually made it possible to route network traffic across to other commercial networks without passing through the government funded NSFNet Internet backbone.

As the Internet grew in popularity across the commercial sector the networks increased dramatically with an ever-increasing number of users.

Towards the end of the 1990s the Internet had grown dramatically and became more highly recognised by business and home users alike through the use of the many online services now available to the general public.

The Internet has changed greatly over the two decades since it came into existence. It will and must continue to change and evolve at the speed of the computer industry and new technologies to accommodate new services over the next decade. This evolution has brought new applications and the movement from private governmental research to the commercial world and home user.

Development of Internet Service Providers & Online Services

The growth of the Internet has mainly been due to the move towards Commercial networks and the introduction of Commercial online services. Delphi was the first commercial online service in the United States to offer Internet access to its subscribers. An email connection was implemented during July 1992 and full Internet service was available shortly after, during November 1992. At this time there were many online services available that were not directly connected to the Internet. These services made available information databases and other relevant material to its subscribers. Later on more Online Service providers began to offer full Internet access such as Compuserve, AOL (America Online), and Prodigy.

An Internet Service Provider (ISP) is a company that connects members of the general public to the Internet. It can be distinguished from an Information Service such as CompuServe or America Online by its emphasis on Internet tools such as USENET News, Gopher, WWW, etc.

Dennis, D (1998) How to become an Internet Access Provider
http://www.amazing.com/internet/ (February 21st, 2000)

As well as the larger well-known online services such as Compuserve and AOL, dedicated Internet Service Providers began to increase in popularity as the Internet grew. During 1991 PSINet, UUNET and CERFnet, (three large computer networks), decided to interconnect their networks at the Commercial Internet eXchange Association (CIX) for the purpose of commercial ISP interconnection.

This move then encouraged the entry of a number of companies into the market within the United States and eventually the interconnection from these networks to outside the U.S.

Towards the beginning of 1995, there were a few hundred CIX members, almost half of which were non-US based networks. By 1996, it was estimated that over 2000 commercial ISPs were running within the US alone. As popularity of ISPs grew largely over the last few years, the number of ISPs more than tripled in the United States to over 6500 during 1998 which has remained stable to this day.

The ISP Industry is primarily made up of small and very small businesses.

Thibodeau P (1999) Internet Service Providers Computerworld Volume 33 Issue 43 [ON PRONET]

In the Autumn of 1997, 200 companies provided three-quarters of the dial-up access within the US, and remaining half of the industry provided only one point of dial-up access.

A CIX survey in early 1997 confirmed that the industry at the time comprised primarily very small businesses with revenues of less than $1 million and with a handful of employees.

“Internet Service Provider Survey”, March 1997

During 1999, of the 6500 ISPs, it turned out that only a few were publicly traded companies. Internet Service Providers all supply the same service by making it possible for users / subscribers to exchange e-mail and access online services through the Web. The Internet is largely a collection of such providers linking a great number of networks together. There are three main types of Internet Service Provider, Tier 1, Tier 2 and Tier3 Providers.

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Tier 1 providers are at the top of the network which are mainly large companies that offer extremely fast data transmission through fibre-optic lines (backbones) which therefore link the Internet together. Examples of Tier 1 providers include Cable and Wireless, AT&T, MCI WorldCom and UUnet. Tier 2 providers are connected to the Internet through the use of a Tier 1 service via a leased line permanent connection. These types of Service providers are normally national or large regional Internet Providers. The chain of connections continue to Tier 3 which provide a service restricted to generally local services with limited reach.

Obviously the closer the connection is to a Tier 1 provider, the faster the service will be, but the costs would be increased greatly. Depending on organizations individual needs, this will determine which type of ISP they will connect to.

Tier 3 providers would cater more for the home user of the Internet and small local businesses that normally would offer services through dial up accounts. This is made possible through connections established on a telephone line via a modem connected to the end users computer. In recent years Tier 3 ISPs have began to offer faster connections through digital lines such as ISDN (Integrated Services Digital Network) and the newer ISDN Highway standard opening the market for larger potential business customers.

Traditional ISPs have been around for several years and although there have been many changes across the Internet in its continuing evolution, there are several services that have remained since the early commercial providers.

Electronic mail – Communication with users throughout the world. This has been the most common and popular service on the Internet since its early days and remains so today.

World Wide Web – The Web has been the Internet’s `killer’ application in recent years. The increased popularity of the web has led to the major growth of the Internet. It includes graphics, text, and most recently multi-media.

File Transfers – The FTP protocol is one of the Internet’s most widely used services. It moves files in or out of websites to end users computers and has become more integrated with the Web in recent years.

IRC (the Internet Relay Chat program) – The IRC was one of the first Internet chat programs and continues in popularity along with newer web-based chat applications.

USENET newsgroups – Also known as Netnews, each these public discussion forums greatly resemble a computer bulletin board system (BBS). They offer members / subscribers access to information about particular subjects, with the ability to post messages and questions to the group.

Gopher – Gopher is a file retrieval program popular with the BBS community. Gopher servers enable a simple access technique to transfer information at your site to others as they request it via gopher and WWW.

WAIS – WAIS is a text searching service. This service, as with Gopher, is no longer used as widely as it once was because of advanced services through the web such as newer search engines like Yahoo and Excite.

During the mid 1990s, there were many commercial Internet Service Providers that had developed a business of providing Internet access to its customers for a subscription fee. By mid 1998 there were many national networks with thousands of regional and local providers, which continued to serve as links to end users of the Internet.

Many businesses soon learned that the basic Internet access market had extremely small profit margins and by 1998 basic Internet access was generally not regarded as a very lucrative part of the ISP commercial market.

It was therefore vital for any business offering dial-up access as a primary service to alter their business strategy towards diversification. Industry trade publication distinguished between two types of activities other than basic access than Internet Service Providers could offer.

Technically Difficult Access

High-bandwidth applications present many technical difficulties which challenge the skills and capital constraints of many ISPs. The slow diffusion of commercially viable high-speed access markets is widely regarded as a major bottleneck to the development of the next generation of Internet technologies.

Greenstein S (1998) Building The Virtual World – Esbin 1998, http://skew2.kellogg.nwu.edu/~greenste/research/papers/building.pdf (February 21st, 2000) 1998

Services that are complimentary to ‘Basic Access’

Providing additional services became essential for retaining or attracting a customer base. Many ISPs instead tried to develop additional services, such as web hosting, web-design services and network maintenance for businesses. Any of these were quite costly, as they had to be properly assembled, maintained, and marketed.

Greenstein S (1998) Building The Virtual World – Werbach 1998, http://skew2.kellogg.nwu.edu/~greenste/research/papers/building.pdf (February 21st, 2000) 1998

Although it has been outlined that the second of these options can be expensive, it can still be possible for smaller ISPs to implement services such as web-hosting and design on a smaller scale due to the cost aspect currently lower across the market.

It has however become evident that the once traditional Dial-Up ISP that charged fees for subscription cannot possibly survive in the new millennium without making drastic changes to the overall structure of the company. It has become necessary to explore additional services and newer technologies that can enhance their business in the future.

Concluding thoughts on the Development of the Internet & Service Providers

The Internet has come a long way since the introduction of ARPANET during the 1960s through to the commercialization of the network. The growth continues today at an accelerated rate giving many business organizations increased opportunities throughout this fairly recent virtual world.

It is because of these smaller Internet Service Providers that the network as a whole has become a global tool and resource to many organisations and home users today. At the same time however the market of ISPs in general has felt increased competitive forces from the larger industry players, including international telecommunication organisations and other larger commercial bodies. It has also become evident that these smaller ISPs can no longer concentrate on access services as their main source of business that once was profitable in the early days of the Internet.

Eventually Internet Access may completely fall into the hands of the larger organisations offering tier 1 access as a backbone to the network. The small to medium sized Internet business must then consider other services and diversify into newer areas to keep them ahead of the competition if they are to survive and prosper well into the new millennium.

Image Credits: Photo by Isis França on Unsplash.

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