Moore’s law describes a long-term trend in the history of computing hardware, in which the number of transistors that can be placed inexpensively on an integrated circuit has doubled approximately every two years. The capabilities of many digital electronic devices are strongly linked to Moore’s law: processing speed, memory capacity, sensors and even the number and size of pixels in digital cameras. All of these are improving at (roughly) exponential rates as well.
In a conversation with Global Telecom & Technology, (“GTT”) (OTCBB: GTLT), a leading global network integrator that provides its clients with a broad portfolio of wide-area network solutions, I was reminded that Moore’s law is actually playing itself out within the IP transit and IP transport space. We have all seen the trends of IP transit price declining. As a matter of fact, discussions on a variety of LinkedIn Groups cite prices as low as $4 per mbps. During my days as the Director of IP Services at Band-X, Inc. I couldn’t make a decent profit if I sold transit below $100 per mbps – $4 seems absurd, but it’s not.
The team at Global Telecom & Technology are well aware of the fact that there continues to be applications developed that require more and more bandwidth. In addition, the growing transition to virtualization and cloud computing is further driving the demand for more bandwidth. If we take into consideration Moore’s law, the amount of bandwidth required by applications will no doubt continue to grow – if not double approximately every two years or at the blistering rates demanded by applications, or even sooner. In addition, as the price per Mbps falls (or stabilizes, because seriously how low can it go), the demand for bandwidth increases substantially – in essence balancing out the curve – since the demand for more bandwidth and greater speeds is growing more than the price decline, still making IP transit and IP transport networks successful business models – if managed the right way.
Too many companies have over built too quickly expecting demand to soar at the same rate of its network expansion. This is where the problems occur in the network space and why measured growth, based on flexibility and options is the key for network operators to succeed.
Global Telecom & Technology, which just acquired WBS Connect, is expanding its company just so. As a global network integrator, GTT has the benefit of growing its network, on demand, to suit end customer network requirements. What makes GTT even more special is that it considers all circuits ‘On-Net’ providing full end-to-end SLA’s for its services. With companies providing managed, secure, reliable and scalable global network connectivity, there should be fewer emerging companies putting their businesses at risk by building what may or may not sell at the rate required to be profitable.