The Electronic Social Fabric

Iacta Interactive Design and Development

The Electronic Social Fabric:
Successor to the Internet
Edward F. Tuck
Keynote speech of the plenary session of the 1996 IEEE International Microwave Symposium, San Francisco, CA, June 18, 1996

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ABSTRACT: The 1980s’ deregulation of the telephone companies decriminalized innovation in telecommunications services. The effect of the resulting burst of innovation on our society is explosive, and has just begun. Resulting societal changes will foster further radical changes in our communications infrastructure, which will in turn lead to more social change, and to the creation of a an electronic Social Fabric, built on the Internet as a substrate. Microwave is the most important transmission medium through which those changes will be achieved, and represents an immense, immediate commercial opportunity.

In October, 1915, eighty-one years ago, here in San Francisco, right down the street, Theodore Vail, the President of AT&T, made an after-dinner speech to the National Association of Railway Commissioners. These were the people who ran the State bodies that regulated the railroads. In one of the most brilliant political moves of this century, to avoid having AT&T nationalized as its counterparts abroad had been, Vail asked the railway commissioners to regulate his company in the same way as they regulated the railroads: he unabashedly said,(1) “Society has never allowed that which is necessary to existence to be entirely controlled by private interest.” He dismissed wireless as a possible competitor by saying, “Talking over wireless is like talking in a boiler shop,” and went on to persuade the regulators that the telephone system was a natural monopoly, which they were exquisitely well-suited to regulate.

He got away with it. As the century progressed, the telecommunication industry, world-wide, was made up of vertically-integrated monopolies: service companies that bought only from manufacturers they controlled. The Bell System, a vertical, regulated monopoly, included Western Electric, and discouraged access by other manufacturers. General Telephone, similarly, owned Automatic Electric. In foreign countries, the telephone company was usually part of the Post Office, and bought its equipment from local manufacturing plants: in effect, a vertical monopoly.

So what do you do if you own a vertical monopoly? You do everything you can to make your service less expensive to provide, but avoid passing your savings on to your subscribers; instead, you use the savings to enlarge your organization. Above all, you must stifle innovation in the services you provide, since any change, any improvement in those services, means you have to spend money. Your factories would have to retool; some of your equipment would become obsolete. You want to innovate only in areas that reduce the cost of your service, or extend it to more subscribers. You don’t want innovations that provide new services: you want to suppress them at all cost.

Thus, up until fifteen years ago, for seventy years or so, we had a vertically-integrated monopoly in telecommunications. Telephone companies depreciated their equipment over forty years; they made the same telephone set for twenty years at a stretch. More important, it was illegal to innovate. If you invented a new kind of telephone and connected it to your line, the ‘phone company would take it away from you. If you did it twice, they would try to put you in jail. In America, and everywhere in the world, innovation in telephone services was suppressed with the full force of law.

So the telephone service I had in 1984 was in most ways worse than the service I got when I was a little boy in the South in the 1930s. Then, I’d pick up the receiver, and the lady would say, “Number, please,” and I’d say, “I want my Mommy!”

She might say, “Well, Skippy, she was over at Miz Ferguson’s, but she left there and now she’s at Miz Furrey’s. Somebody’s using the phone there right now, but I’ll break in and tell them you need your Mama.”

We had call waiting, call forwarding, executive override and voice recognition. I didn’t even have to dial. Things went straight downhill from there.

The American telephone industry was deregulated, piece by piece, in the early 1980s. Except for the transmission industry, particularly the microwave industry, the American telecommunications manufacturers missed the opportunity: they weren’t ready. They were so used to the idea of a regulated industry, they didn’t really believe it when deregulation happened: foreign companies dominated the switching business for years after deregulation, and still dominate the subscriber equipment, or “telephone set” business. None of the established telephone equipment manufacturers is a factor in routers, the replacement switching technology. In contrast, the microwave people, especially the short-haul crowd, who had been in one of the niches where the monopolies would buy from independent suppliers, had been fighting like tigers for years, and did take advantage of the opportunity. American microwave manufacturers are still world leaders in highly-innovative new products like millimeter-wave radios and advanced modulation schemes.

So in the 1980s, the world said that it was deregulating telecommunications; but it was really decriminalizing innovation. There was 70 years of pent-up innovation waiting to explode, world-wide, and the explosions, the revolution, has begun. The first explosion was the expansion of packet switching and transmission, and universal Internet access, which will cause the first profound change in the structure of the telecommunications industry in fifty years. In particular, it will have a dramatic effect on the regional local service monopolies, such as the Bell Operating Companies.

Imagine, for a moment, a young mother who is talking to her own mother on the ‘phone, while watching her daughter, Little Suzy, crawl around on the floor. Little Suzy makes her way to a chair, pulls herself up, and, with many a lurch and totter, walks across to the sofa. Her mother grabs the camera next to the phone, points it at Suzy, pulls the trigger, and says, “Look! Mama! Little Suzy’s taking her first steps!”

The packet connection, which had been running along at 16 or 20 kilobits per second, suddenly jumps to a megabit. When Little Suzy makes it to the sofa and her mother puts the camera down, the channel collapses back to 16 kilobits or so.

At the end of the month, the Virtual Meter Reader walks up to the house and reads the Virtual Meter, and says, in his virtual way, “Mrs. Garcia, you used 10⁴⁶ packets last month. That’ll be $4.96.”

When Suzy grows up a little and plays with her friends or gets assignments from her teacher, she’ll do it with pictures and games, at 100 kilobits or so; when her parents buy a car or a house, they’ll first shop around, at a couple of megabits. They’ll do all of this on one of several packet connections. They’ll be cheap, and everyone will have them, from a choice of service providers, and from a choice of wireless and physical media.

So the idea of tariffed services, where the ‘phone company files legal documents with the States allowing them to charge you at different rates for different services even though they use the same facilities to provide them, is going out the window. And the local service provider, be it telephone company, cable operator or wireless entity, has just become a transmission utility, like the power company; so the services you get aren’t determined by the service provider any more, but by the terminal you hook up to the line. Just like the power company. If you want to make toast, you plug in a toaster; if you want to dry clothes, you plug in a dryer; and if you want to be a mass murderer, you plug in a chain saw. The power company doesn’t care: it’s all kilowatt-hours to them.

The network has now become a lot simpler. It’s just transmission and packet switching, and the distinction between them is very, very fuzzy. Why not do some switching in the microwave terminal? There’s no need to go across town to a toll switch, if the packet already knows where it’s going. All of a sudden, you don’t need a switching hierarchy any more. All of a sudden, the network starts to resemble Mr. Huber’s famous Geodesic Network(2) (it’s no mystery where Teledesic’s name came from) and its connections, like the Internet, are mostly among peers. The telephone companies’ asset base suddenly is worth a lot less, except for the parts that can be used to provide broadband transmission. Their most valuable asset may turn out to be the conduits under the street, where you can run fiber, and their subscriber base.

Telecommunication is just another way of talking, and reading and writing are ways of coding and decoding talk, and talking is the way people interact with each other. The courts recognized this last week, in a brilliant decision that said, in effect, “You can’t regulate the Internet any more than you can regulate conversations at a party.” Since society is nothing but communication, when communication technology changes, society changes. When communications change radically, society changes radically; and those changes drive improvements in the new technology, which in turn bring about more change. Think about it:

When we learned to write, we got structured religious hierarchies, and from those we got autocratic governments.
When we got printing, we got religious decentralization and the Renaissance, with its democratic ideas; these spawned the American and French revolutions.
When we got the telegraph, and its successor the telephone, we got new kinds of businesses that addressed national markets.
When we got radio, we got a sense of national unity: our accents began to flatten; regional differences began to disappear. Wars became global.
When we got television, we got another social revolution: not from the programs, but from the commercials, which implied that every ordinary person could afford the goods and services they advertised; it was this sense of deprivation that fueled the civil rights movements of the ‘50s and fundamentally changed the world.

Better late than never, we now have broadband. The Internet is inherently a broadband medium; but it doesn’t work right because its local connections aren’t broad enough. In spite of its awkwardness, its frustrating slowness that drives its users to desperation, it’s already beginning to create its own revolution. A first study(3), published a couple of weeks ago by Odyssey, showed that time people spend on the Internet is time they formerly spent watching television. This is startling information. It is of earth-shaking importance. This is what it means:

It means that people are beginning to abandon a passive medium, television, for an active, participatory medium, the Internet. This is reversing a trend toward passive recreations that began in the ‘30s, when radio broadcasting became universal. And it’s happening in the face of the fact that the Internet is a clumsy, awkward medium that’s hard to use by anyone’s standard.

That in turn means that advertisers are losing contact with their customers, and will move to the Internet to regain contact. But the Internet is a horrible medium for advertising: its connections are slow, and as a result the ads are intrusive and deeply resented. But there’s no choice: since television is our primary commercial medium, and a significant number of people are beginning to replace television with the Internet, commerce will move to the Internet. And because the Internet allows real-time consumer transactions, it will become the world’s conduit and forum for commerce in the next few years. To do this, the network must evolve to support this enormous load, and it must change fundamentally to do it and do it well.

Just as black-and-white television was hopelessly inadequate for advertising automobiles, so today’s Internet is hopelessly inadequate for advertising and selling anything but printed matter or software. In its present form, it cannot, by any stretch of the imagination, support commercial activity on a large scale. The Internet needs a successor. And the successor can’t have big holes in it, like a fishing net. It will have to be like cloth, like a fabric, where three or four threads are within everybody’s reach. To be adequate, this successor, this electronic Social Fabric, if you like, must support two-way broadband connections. Not ISDN, which is the last stand of the analog network, but real, megabit, two-way, full-duplex connections to everyone, everywhere, and with the switching and transmission to support them.

Just as the Soviet planned economies couldn’t survive because central planning became I/O bound and couldn’t deal with the complexities of a modern society, so nations with closed information societies won’t be able to compete, or even co-exist, with nations with open, peer-to-peer Social Fabric information structures.

The Social Fabric will bring some other surprises as well. Kids learn best when they participate, not when they’re lectured to. Because the Fabric will support two-way, high-speed connections, education can become fully participative for the first time in history. Like parents, who don’t sit you down and teach you, but who by their behavior create a framework for their children to build an ethical structure, so the Social Fabric, like an extended family, will contain a consensus framework on which standards of behavior and civilized interaction will be built.

Who’s going to pay for all this? The entities that benefit from it. An enormous amount of money will be dumped into Social Fabric expansion and improvement, directly and indirectly, by the commercial enterprises that need a broadband, universally-accessible medium to sell their products. Let me remind you that it was not the television viewers who demanded color television. They were happy with black and white, and resented the high prices and poorer quality of color TV sets: it was the advertisers, who found that their products sold much better in color, who forced the change and financed it.

So who will win? As always, it’ll be the people. But the commercial winners will be the equipment manufacturers, and foremost among those will be the microwave people: the one segment of the traditional telecoms industry that’s been paying attention. History shows every time there’s a revolution, it’s the munitions makers who win, and the ones who win biggest are the ones who make bullets that fit everybody’s guns. The neat thing about microwave, is that it’s always been an industry dominated by engineers, and engineers love to make things work together. We may be weenies, but we ain’t dumb. Our bullets work for everybody.

Microwave people, bless ‘em, have been paying very close attention. We have the only transmission medium that can be deployed immediately. Because it does not require rights-of-way, wireless in general and microwave in particular are usually cheaper than terrestrial systems over reasonable distances, and are much quicker to install. Satellites are simply microwave systems on very tall towers. The large-scale constellations, based on millimeter waves, will provide the connections that fill in the holes in the net, and make it a fabric. They will be a better choice than terrestrial microwave for non-urban locations. And we are lucky to have an Administration and an FCC that are flexible, and want to help our industry succeed. Their rules are no longer written in stone.

The opportunity is overwhelming: cheap, low-cost last-mile or even last-fifty-foot connections; broader-band links with integrated switching to concentrate those users; big, low-Earth-orbit satellite systems, like Teledesic, indifferent to their users’ locations, using millimeter waves to bring instant broadband infrastructure to the world, filling the net’s holes; high-capacity interexchange radios to support the increased load on our voice telephone network; links to backhaul the voice and data out of our increasingly sophisticated cellular and PCS systems; and a lot more applications, most of which no one has thought of yet.

So what’s in store for microwave manufacturers? We’ve already seen the first surge of demand drive the prices of microwave down and the volume up, and create new, large companies, like P-COM, that weren’t in the market a couple of years ago. This is only the beginning of a much larger upward trend. In addition to demand created by last-mile links, low-Earth-orbit satellite systems, since they must be rebuilt every eleven years or so, will provide a steady stream of orders for microwave components and other telecommunications equipment that will further improve the cost and availability of microwave equipment. This demand is itself a force for change. Teledesic’s current design alone will use almost a billion gallium-arsenide chips, and an enormous number of millimeter-wave circuits and antennas; the nation whose manufacturers supply Teledesic and its competitors, by the sheer volume of packet switches, RF assemblies, antennas, spacecraft and launch vehicles, will dominate the telecommunications, spacecraft and launch vehicle markets of the early 21st Century.

Stable, quiet millimeter-wave oscillators, amplifiers and detectors are now available at low cost for the first time. This opens up vast amounts of radio-frequency bandwidth that simply couldn’t have been used before. The resulting volume in millimeter-wave electronics will rapidly drive prices of those components down to commodity levels, benefiting microwave systems manufacturers.

Regardless of who wins and loses in the regulatory arena, the microwave equipment suppliers will always win, as they have in the past. In the whole history of electrical communication, no one has ever overestimated the demand for bandwidth. Therefore, unlike most industries, where demand drives innovation, in microwave, innovation satisfies permanent demand. Microwave, unique among industries, actually does follow the better mousetrap theory: any new transmission technology that provides a significantly higher bandwidth-to-cost ratio has historically sparked a new surge in business.

Let me leave you with a lesson from Business 101: Companies that are aggressive in a new market, who gain and hold major market shares, are the ones who become the low-cost suppliers, and who become the immense companies that survive when the market matures. We, the microwave people, did it right in the ‘80s, but we were a small part of the telecommunications business. This time, our opportunity is enormous: we, the microwave people, will be the largest segment of the telecommunications business for the next ten years. Microwave will be the threads of the Social Fabric, and the people who use the Social Fabric will in fact weave it as they use it, through their interactivity. Our part is crucial. Let’s do our job right. Let’s learn from the mistakes of the switching and apparatus segments, and exploit this, the greatest manufacturing opportunity telecommunications has ever seen.

There is a convergence of technology in packet switching, satellite design and microwave equipment, particularly millimeter-wave equipment, and gallium arsenide technology, which is necessary to all this. Today’s microwave industry has the opportunity to dominate the market for telecommunications equipment going into the next century. This is our karma, and it’s your responsibility to make sure it happens. Don’t mess it up.

1 . Vail, Theodore, Some Observations on Modern Tendencies, An address by Mr. Vail at a dinner given by the Railroad Commission of California to the National Association of Railway Commissioners, at San Francisco, October, 1915. Jump to reference.
2 . Huber, Peter W., The Geodesic Network, 1987 Report on Competition in the Telephone Industry, January 1987, U.S. Department of Justice, Antitrust Division; Superintendent of Documents, U.S. Government Printing Office, Washington, DC. Jump to reference.
3 . Browning, John, “New Stars for New Media,” Scientific American, Volume 275, Number 1 (July, 1996), p. 31 Jump to reference.