Eric Schmidt, CEO of Google, is wrong

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…and causes me to wonder about everything else he’s said in his article published in The Economist’s World in 2007 magazine.

In this article, Mr Schmidt has fallen into the common trap of talking about how IP networks have taken over the world of networks, replacing all other network technologies. IP, if you don’t know, stands for Internet Protocol, and it’s the phenomenal success of the Internet that has led Mr Schmidt, and many others, to this wrong conclusion.

In the article in question, Schmidt says “In the battle of acronyms, IP has beaten ATM, CATV/CO-ax and the rest because it always means more choice”.

To explain why this is incorrect, I’m going to have to wander through the rather arcane area of networking technologies and in-particular something called the ISO OSI 7 layer model. ISO stands for International Standards Organisation and OSI stands for Open Systems Interconnect. Pretty straightforward so far. The 7-layer model has been one of the most useful concepts in computing, telecoms and the internet for ensuring that we, the consumers, get a fair deal.

Years ago, in the days of the dedicated mainframe, manufacturers would design their products to be proprietary, locking users into their technologies and of course being able to exploit that lock-in and lack of choice by charging premium prices for their products. The only way to provide users with choice was to ensure that systems from one manufacturer could physically connect to those from another manufacturer and that the signalling between the two would make sense.

And that is the raison d’etre for the ISO OSI 7 layer model. A practical, everyday example of how this has helped us; pop into PCWorld, for example, and buy a USB memory stick. It really doesn’t matter who has made it, or into which system you’re going to plug it - Mac, Dell, whatever, you know that it will work. This is because the physical and electrical design has been standardised. The result is carefree purchasing and your choice is probably based on price and colour - nothing more technical than that.

What’s this got to do with the internet?

The internet is a network - clearly - and as such many standards are applied to the various technologies used within it. This includes everything from fibre optics deep beneath the ocean to stuff on your virtual desktop.

Imagine, if you will, a 7 story building, each floor housing a different department with certain responsibilities. The ground floor, or layer 1, is responsible for the physical world; they design the shape and size and dimensions of things such as USB sockets, as well as low level signalling and procedural interface.

If you get into the lift in our imaginary 7 story building and go to the 2nd floor, you enter the Data Link department. This layer of the building is responsible for the functional and procedural means to transfer data between network entities and to detect and possibly correct errors that may occur in the Physical layer. An example that you may be familiar with is WI-FI.

Up one more floor to the 3rd floor and we’re in the department responsible for the “Network layer”. The Network Layer provides the functional and procedural means of transferring variable length data sequences from a source to a destination. Variable length data sequences refers to “packets” of information. Typically these are “IP Packets” or Internet Protocol Packets. In addition, IP provides an addressing mechanism, so that destination and origination addresses are known. This is the IP Address, which you may also have come across.

We could stop off at all the other floors, or layers, in this building as they are all relevant, but instead we’re going to take the express elevator all the way to the top floor - Layer 7. Layer 7 is where the Application department sits and they are responsible for providing a means for the user to access information on the network through an application such as a browser. You’ve used this every day, at least if you’ve been anywhere near the internet. HTTP (HyperText Transfer Protocol), the first 4 letters of a URL, is defined at Layer 7.

Now we’re getting close to the point of why Eric Schmidt is wrong. You see, CO-ax (co-axial cable) is a Layer 1 feature, it being the design and attributes of physical cable - the kind of stuff that cable TV or TV signals from an arial are delivered on. To say that IP has displaced Co-ax is like saying that electricity has replaced the plug; clearly nonsense.

ATM in networking terms refers to Asynchronous Transfer Mode, not Automated Teller Machine (a telecoms joke, ha ha!). ATM is a Layer 2 technology. You may have come across ATM if you have an ADSL or Broadband Router at home - one of the settings is for PPPoA. The “A” in PPPoA stands for ATM (PPP stands for point-to-point protocol, also defined with Layer 2 - rather confusingly our 7 story building has departments within departments).

Just like any organisation that is successful, all of the different departments in our imaginary building have to work together, at the appropriate time and place, each fulfilling its function. IP doesn’t travel “naked” - is always needs to be carried by something else, in the case of “broadband” to the home this is often Layer 2 ATM. So there really isn’t such a thing as an “IP Network” - just networks that use IP, along with everything else from our 7 story building.

So to summarise: Co-ax is a Layer 1 physical thing, ATM is a layer 2 “cell-based” data link technology and IP is a “packet-based” layer 3 “data transfer” technology. So it’s just not possible for IP to have replaced either ATM or Co-ax and indeed there is far more of both around today thanks to broadband and cable TV.

There are other reasons why Mr Schmidt is wrong, which I’ll explore in another posting later.

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First published 2007