[extropy-chat] Re: A slow down in Moore's law?

[Mike Lorrey]

--- BillK <pharos at gmail.com> wrote:

> On Thu, 21 Oct 2004 06:38:04 -0700 (PDT), Mike Lorrey wrote:
> > 
> > One reason why pro-singularity people all over should be lobbying
> to
> > repeal the Telecommunications Reform Act which stifled the progress
> in
> > getting fiber optic to everyone's home. It was this one act which
> > killed the dot com boom, and is now starting to drag down the rate
> of acceleration.
> > 
> 
> Oh, really? And there was me thinking it was just another stock
> market bubble, like all the previous (and future) market bubbles.

[gets on soap box]

What is a 'market bubble'? It is a surge in the markets expectations of
future gains based on the assumption that things will continue with
current trends, that ends when those trends cease or change.

Why did the late 90's bubble burst? It helps to look at the trends that
were driving that bubble. One of the biggest trends was the global
growth in bandwidth. Enron, Global Crossing, Worldcom (starting to see
a pattern?) among others, all were heavily vested in backbone
infrastructure, particularly intercontinental optical cable.

Why did these companies invest so much in so much bandwidth? Because
they were expecting the US telecommunications markets to actually be
reformed such that companies would be free to invest in putting fiber
optic through to "the last mile" to people's homes, giving people
immense amounts of bandwidth very cheaply. Solving the 'last mile'
problem would have empowered people to do immense amounts of data
processing at home, work at home, and operate in virtual environments
like those forseen in science fiction.

This was the sort of world we were headed for, and would be living in,
right now: the world of Snow Crash, and heading toward The Diamond Age
in our future only a few decades hence. Nations and governments of the
1990's were headed toward obsolescence. Remember how we all used to
talk about that sort of stuff?

The prospect of this scared the bejeezus out of some people. Some very
powerful people. People vested in the status quo, in maintaining their
control. They could not let this sort of future happen.

So they didn't let it happen.

They passed a provision in the TRA which essentially stated that ANY
company that routed optical fiber to a persons home HAD to allow their
competitors access to that customer for less than the cost of putting
that fiber connection in. Faced with a mandated money losing situation,
the telecoms decided: "Fuck it, we won't put optic in." Simple as that.
Instead, we are left using DSL and Cable Modems which, while an
improvement on 56k dial-up, are still light years slower and narrower
than optic.

This is not my rambling, BTW. At least one other list member, who
worked in the telecom industry during that period, first floated that
on this very list back in '98 and '99. The TRA IS the cause of the dot
com crash. 

The dot coms were all looking forward to the immense amounts of
bandwidth that were promised to be available soon. I personally knew of
ventures working on concepts like VR Bordellos, VR sports broadcasts(so
that you could actually view the game from the huddle, from the
pitchers mound, etc), as well as a number of other such ventures
requiring large amounts of bandwidth to achieve. They all went tits up
in 2000-2001 as the TRA started to have an impact on things. 

The capital they had received was spent and never earned a return on
investment (and never was able to compound any interest for anybody).
You know what happened to Enron, Global Crossing, and Worldcom.

Compounded interest that one earns on one's investments, and is
responsible for the real growth in one's savings that one depends on
for the future, is a lot like Moore's Law, because both operate on a
process of exponential growth. Moore's Law was trucking along on a wave
of capital market growth that was itself being fed by the productivity
gains of prior computer generations and their impact on the economy as
a whole. That trend NEEDED more bandwidth to continue. It HAD to have
it to keep the exponential curve going.

When one law got changed that disinscentivized investment in the growth
of the local bandwidth capacity, the whole ball of wax collapsed. Whole
future worldlines winked out of existence. Governments are still not
obsolete, people are still paying taxes, and you have to wonder why
transhumanist science fiction hasn't turned out as we thought it would?
Government wouldn't let itself be obsolete, it fudged the rules to make
sure it stayed relevant.

=====
Mike Lorrey
Vice-Chair, 2nd District, Libertarian Party of NH
"Necessity is the plea for every infringement of human freedom.
It is the argument of tyrants; it is the creed of slaves."
                                      -William Pitt (1759-1806) 
Blog: http://www.xanga.com/home.aspx?user=Sadomikeyism


		
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