IP: Inventing the Internet Again - George Gilder Essay

[David Farber <farber () cis upenn edu>]

Date: Mon, 7 Jul 1997 22:26:59 -0400 (EDT)
From: ptownson () massis lcs mit edu (TELECOM Digest Editor)
To: ptownson () massis lcs mit edu
Subject: Inventing the Internet Again - George Gilder Essay




Here is another recent article by George Gilder as part of the
series he is writing.




PAT


  From: gaj () portman com (Gordon Jacobson)
  Subject: George Gilder's Telecosm Article - Inventing The Internet Again
  Date: Mon, 23 Jun 1997 15:22:30 GMT
  Organization: Portman Communication Services


     This series of articles by George Gilder provides some
interesting technological and cultural background that helps prepare
readers to better understand and place in proper perspective the
events relative to the National Data Super Highway, which are
unfolding almost daily in the national press.  I contacted the author
and Forbes and as the preface below indicates obtained permission to
post on the Internet.  Please note that the preface to this article
and all footnotes must be included when cross posting or uploading
this article.


     
         The following article, INVENTING THE INTERNET AGAIN, was
         first published in Forbes ASAP, June 2, 1997.  It is
         a portion of George Gilder's book, Telecosm, which will
         be published in 1997 by Simon & Schuster, as a sequel to
         Microcosm, published in 1989 and Life After Television
         published by Norton in 1992.  Subsequent chapters of
         Telecosm will be serialized in Forbes ASAP.






                     INVENTING THE INTERNET AGAIN
     
                                   By


                             George Gilder
     
     
     
     FOR THE FIRST TIME IN HIS LIFE as an engineer, Paul Baran was
"scared stiff."  That can happen to people who stumble too close to
the abyss of 20th-century history and look over the edge.  Born in
1926 in a house in a corner of Poland that had been claimed by three
different nations during his parents' tenure, brought to America by
his family at the age of 2, Baran was a child of European tempests.
     
     But now, in the heady Southern California of the 1950s, the young
Hughes Aircraft engineer found himself working in an American
crucible. He was a design engineer for the Minuteman missile control
system.  Unlike the liquid-fueled Titans of the previous era, which
required hours of preparation before they could fly, Minuteman could
be instantly rocketed into the sky.  To the Pentagon this seemed
safer.  The solid-fueled rockets would not be vulnerable for hours on
the ground awaiting fueling.  But Baran an d his colleagues knew that
this would be the most deadly and dangerous military system ever
built.  One accident and a cloud of missiles was on its way.
     
     Appreciating the risks in the proposed design, Hughes summoned
Warren McCullough from MIT as a consultant on human behavior.  An
expert on command and control-and a psychiatrist and brain surgeon to
boot-McCullough explained the emerging facts of life.  Throughout
history, he told the Hughes engineers, the real command of the battle
migrated to the men closest to the enemy.  The man in the crow's nest,
not the officers on the ship's bridge, was in de facto control.  What
he saw and reported determined the captain's orders.  Regardless of
nominal chains of command, the real governance of history moved to
individual people on the front lines, often frightened or panicked at
the time.  But in the nuclear age, no such single person, necessarily
fallible, could ever be trusted.
     
     Analyzing the technical problems of creating a command-
and-control system for Minuteman, Paul Baran found himself abruptly in
the crow's nest, stricken by historic terror-"scared stiff," as he
recalls.  It was clear to him that the problem was systemic; it could
not be solved by tweaking the command-and-control schemes then being
proposed at Hughes.
     
     To explore the problem more broadly, Baran in 1959 left Hughes
for RAND, the not-for-profit (the name stands for "R&D") set up after
World War II to harbor the systems analysis skills developed during
the war.  At RAND the formidable strategist Albert Wohlstetter was
demonstrating that in a matter of minutes Soviet short-range missiles
could take out all U.S. foreign strategic air command bases encircling
the Soviet Union.  Then the Soviets could say stick 'em up-demanding
surrender on the basis of the vulnerability of remaining U.S. missiles
to superior Soviet forces.  In many vivid papers and speeches,
Wohlstetter relentlessly presented his argument that U.S. forces faced
a "missile gap."  The famed Alsop brothers, leading columnists of the
day (Stewart was the father of the computer writer), echoed the
Wohlstetter claims.  John Kennedy listened and made the gap a theme of
his 1960 presidential campaign.
     
     Wohlstetter and his colleagues urged that the Pentagon redeploy
its strategic forces to the United States and endow them with a
second-strike capability-that is, to withstand a first strike and
retaliate in kind.  Greatly reducing the temptation to go first, this
posture would escape the dangerous hair-trigger tenterhooks of the
early cold war.
     
     A viable second-strike capability, however, assumed that the
command, control, and communications systems would remain intact.  It
was here that Baran fretted.  He saw that one nuclear explosion at
high altitude would affect the ionosphere for many hours and thus wipe
out all long-range, high-frequency radio communications.  In addition,
one strike at the centralized switching nodes of AT&T would destroy
the rest of the control network.  The missile system might endure, but
it would be deaf and blind.
     
     Plunging deeper into history than Kennedy had, Baran resolved to
design a communications system that could survive a nuclear attack and
save the second-strike deterrent.  He took inspiration from another
idea of MIT's McCullough-a parallel computer system with adaptive
redundancy.  Like the human brain, such a system could reconfigure
itself to work even after portions were destroyed.  But using the
noise-prone analog circuits of the time, it was impossible to build
the necessary switches.  Baran concluded that all the traffic would
have to be digital.  Moreover, the digital traffic would have to be
broken into short message blocks now called "packets," each containing
its own routing information, like a DNA molecule, and able to
replicate itself correctly whenever a transmission error occurred.
With many additions and permutations, his original design is today
termed the Internet, and it is shaping the emerging history of the
21st century.


THE INEXORABLE LOGIC OF DIGITAL COMMUNICATION


     Baran, though, is not satisfied with his creation.  Contemplating
its vulnerability to terrorism and other attack, he feels pangs of
fear that echo his alarm of 40 years before.  As more and more of the
critical systems of advanced industrial society migrate to the Net,
they become susceptible to new forms of sabotage, espionage, hacking,
and other mischief.  Air traffic controls, train switches, banking
transfers, commercial transactions, police investigations, personal
information, defense plans, power line controllers, and myriad other
crucial functions all can fall victim to cybernecine attack.  If the
Internet is to fulfill its promise as a new central nervous system for
the global economy, its security and reliability problems will have to
be addressed.
     
     Seventy-one years old, still with his Ph.D. economist wife Evelyn
(their son David is director of information technology at Twentieth
Century Fox Home Entertainment), Baran remains in the crow's nest,
buffeted by inklings and insights of historic threats and
opportunities. In a sense, Baran's current projects merely fulfill the
far-reaching logic of his original concept, elaborated at RAND between
1960 and 1962 and published under the title "On Distributed
Communications" in 11 compendious volumes in 1964: a survivable
"network of unmanned digital switches implementing a self-learning
policy at each node, without need for a central and possibly
vulnerable control point, so that overall traffic is effectively
routed in a changing environment."
     
     To fulfill this scheme, Baran specified all the critical
functions of the Internet: packets with headers for addresses and
fields for error detection and packet ordering.  He described in
detail the autonomous adaptive nodes found in Arpanet IMPs (interface
message processors) designed by Bolt, Beranek & Newman (BBN).
     
     Baran also included features only recently and selectively
introduced, such as encryption, prioritization, quality of service,
and roaming ("provisions to allow each user to 'carry his telephone
number' with him").  He described a web of peer nodes each connected
to three or more other nodes, and he offered the first of the
distributed routing algorithms that have multiplied over time.
     
     Unique to his vision was its grasp of the economics of a network
that could handle "the expected exponential growth in the transmission
of digital data."  Declaring that "it would be possible to build
extremely reliable communications networks out of low-cost unreliable
links, even links so unreliable as to be unusable in present-type
networks," he estimated that the price of the system would be some $60
million per year.  That was some 20 to 30 times less than what was
being paid by the Department of Defense for their leased
communications systems without any of these features.  It was two
orders of magnitude cheaper than new analog national systems being
proposed at the time by each of the three military services.
     
     Thus Baran not only conceived the essential technical features of
the Internet, he also prophesied the cliff of costs over which digital
technology would take the networking industry.  By imagining the
compounding effects of Moore's law three years before Moore's own
famous prophecy, Baran stressed the key economic drivers that impelled
the prevalence of the Web as the universal Net.
     
     The system of communications that Baran attacked in the early
1960s at RAND was the imperial establishment of AT&T.  As Baran
explains, "While AT&T did have digital transmission under examination,
it was in the context of fitting directly into the plant by replacing
existing units on a one-for-one basis.  A digital repeater unit would
replace an analog loading coil.  A digital multiplexer would replace
an analog channel bank-always a one-for-one conceptual replacement,
never a drastic change of basic architecture.  I think that AT&T's
views on digital networks were most honestly summarized by AT&T's
Joern Ostermann after an exasperating session with me: 'First, it
can't possibly work, and if it did, damned if we are going to allow
the creation of a competitor to ourselves.'"
     
     In 1972 the company sealed its fate by turning down an
opportunity to buy the entire Arpanet.  As Larry Roberts explained in
{Where Wizards Stay Up Late}, "They finally concluded that the packet
technology was incompatible with the AT&T network."  So it was and so
it still is.  The existing phone system remains the chief obstacle to
the final triumph of the Net.  But the logic of digital communications
is inexorable.  It will displace all the existing establishments of
television and telephony.
     
WASTED FOREVER...LIKE WATER OVER A DAM


     These days Baran's vision, however, goes far beyond wireline
communications.  Baran takes the Internet model and extends it boldly
to wireless communications.  On June 23, 1995, on the occasion of the
Marconi Centennial, marking the 100th anniversary of the invention of
the radio, Baran gave a momentous keynote speech in Bologna, Italy.
In it he demanded a radical reconception of wireless networks.
     
     "The first 100 years of radio," he declared, were marked by a
perpetual "scarcity of spectrum.... One of the very first questions
asked of young Marconi about his nascent technology was whether it
would ever be possible to operate more than one transmitter at a time.
Marconi's key British patent #7,777 taught the use of resonant tuning
to permit multiple transmitters.... [Yet] even today, with over 30,000
times more spectrum at our disposal than in Marconi's day,
entrepreneurs wishing to implement new services encounter the same
perpetual shortage of frequencies."
     
     Focusing on the most desired bands between 300 and 3,000
megahertz (UHF), Baran asserted that when you "tune a spectrum
analyzer across a band of UHF frequencies,:" you discover that "much
of the radio band is empty much of the time.  This unused spectrum
might be available for transmission if we could take measurements and
know exactly when and where to send the signal."
     
     As an example, he cited "the many millions of cordless
telephones, burglar alarms, wireless house controllers, and other
appliances now operating within a minuscule portion of the spectrum
and with limited interference to one another.  These early units are
very low power {dumb devices} compared to equipment being
developed that can change its frequencies and minimize radiated power
to better avoid interference to itself and to others.
     
     "In part," he declared, "the frequency shortage is caused by
thinking solely in terms of dumb transmitters and dumb receivers.
With today's smart electronics, even occupied frequencies could
potentially be used."
     
     The chief reason for the apparent shortage of spectrum, he
concluded, is regulation of it.  Echoing his earlier critique of
wireline communications, he declared that "the present regulatory
mentality tends to think in terms of a centralized control structure,
altogether too reminiscent of the old Soviet economy.  As we know
today, that particular form of centralized system... ultimately broke
down.  Emphasis with that structure was on limiting distribution
rather than on maximizing the creation of goods and services.  Some
say that this old highly centralized model of economic control remains
alive and well today-not in Moscow but within our own radio regulatory
agencies."
     
     The heart of the problem is the concept of spectrum as public
property-as scarce real estate or a precious natural resource.
Spectrum is nothing of the kind.  It has been created by a series of
brilliant technical innovations, beginning with Marconi and continuing
in a steady stream of high technology oscillators and digital signal
processors: from magnetrons and kystrons to varactor multipliers and
surface acoustical wave devices, from gallium arsenide and indium
phosphide heterojunctions to voltage-controlled oscillators and Gunn
or IMPATT diodes.  Spectrum is chiefly a product of inventors and
entrepreneurs.  Americans will rue the day when foreign governments
and international organizations begin auctioning and taxing,
marshaling and mandating the use of these mostly American
technologies.
     
     The real estate model applies chiefly to broadcasters and others
using analog modulation schemes in which all interference shows up in
the signal.  A television signal requires some 50 decibels of signal
to noise power, or 100,000-to-1.  By contrast, error-corrected digital
signals can offer virtually perfect communications at a signal-to-
noise ratio well below 10 decibels, or 10,000 times less.  Moreover,
new digital systems can divide and subdivide the spectrum space into
cells and differentiate calls by spread- spectrum codes or even
isolate particular connections in space by
space-division-multiple-access-devices that function as "virtual
wires" allocating all of the spectrum to each call.
     
     Baran pointed out that "any transmission capacity not used is
wasted forever, like water over the dam.  And there has been water
pouring here for many, many years, even during an endless spectrum
drought.:" Although Baran urged as an ideal the transfer of the 480
megahertz of spectrum currently occupied by analog broadcasters to
fiber optics and cable coax, he said, "We don't have to wait [for this
ideal solution]....The existing spectrum can be more efficiently used
by resorting to smart receivers and transmitters."


SMART RADIO IS A BRAIN BEHIND THE ANTENNA
     
     To conceive of Baran's model of wireless, begin by thinking of
the human eye and comparing it to a radio.  Like a radio, the eye is
essentially a device for converting photons into electrons, pulses of
electromagnetic energy into electrical currents.  Geared for visible
light rather than radio frequency signals, the eye is a receiving
antenna.  As radio technology moves up through the microwaves toward
the infrared realm-with infrared wireless links from Canon now
reaching 155 megabits per second-many of the differences are
dissolving.
     
     Yet, in the crucial index of performance, the radio is
drastically inferior to the eye.  While most radios can receive
signals across a span of frequencies ranging from the kilohertz to the
megahertz, from thousands to a few million cycles a second, the eye
can grasp signals with a total bandwidth of more than 350 trillion
hertz (terahertz).  That is the span of visible light, from 400
terahertz to 750 terahertz, red to purple.
     
     How is it that your eyes command 350 terahertz of bandwidth and
your FM radio around 20 megahertz, 17 million times less? It is not
chiefly the special powers of the retina and other optical faculties.
Radio antennas can collect an even larger span of frequencies.  The
difference is mostly behind the receiver.  Backing up the eyes is the
processing power of some 10 billion neurons and trillions of synapses.
Backing up the radio antenna is a lot of fixed- analog hardware.  Eyes
are smart and aerobatic while the radio is dumb and blind.
     
     In Baran's vision, the future of wireless is the replacement of
current dumb radios by smart digital radios that resemble eyes.
Coupling radio technology with computer technology, the antenna can
acquire a brain.  Smart radios can eventually process gigahertz of
spectrum (billions of cycles a second).  They can sort out the
frequency channels much as eyes sort out arrays of color, and pin down
codes and sources of radiation much as the eyes descry different
sources, shapes, and patterns of light.  For example, a smart radio
could process phone calls, videos, teleconferences, geopositioning
codes, speed-trap lasers, and emergency SOS's.
     
     The result will be a transformation of the nature of the
spectrum.  The current real estate model will give way to a new view.
Rights to spectrum will roughly resemble drivers' licenses for use on
the highways.  Today you use your 350-terahertz eyes to survey the
highway in front of you and avoid other traffic.  As long as you do
not collide with other users, pollute the air, or go too fast (use
excessive power), you can drive anywhere you want.  As radios are
computerized, they will be able to "see" the radio frequency spectrum
as your eyes see the roads.  Smart radios will be licensed to drive in
open spaces in the air as long as they don't collide with other
radios, overpower them, or pollute the airwaves.
     
     As Baran argues, the fulfillment of this dream is at hand.  It is
the broadband digital radio or software radio.  Essentially, the
radios used in cellular or PCS (personal communications services)
phones will be able to differentiate among frequencies; they will be
able to tell which direction a signal is coming from and isolate it in
space; they will be able to identify the language of codes and
protocols and waveforms that it is using and download software
translators.  No longer caught in a dedicated set of channels, time
slots, protocols, data types, and access standards, radios will be
smart and agile rather than dumb and fixed frequency.


MOORE'S LAW WILL LEAPFROG TODAY'S LIMITS


     This will not happen tomorrow.  But like any technological vista,
it illuminates the future.  It opens the way to a new wireless
paradigm, fully in place shortly after the turn of the century, that
will mandate an entirely new model of wireless regulation and a new
method for judging the evolution of companies and their prospects.  In
general, the companies on the path to broadband digital radios-the
smart radio-will prevail over companies that hook their futures to
hardwired machines linked to narrow spans of frequencies.  Moore's
law, the doubling of computer power every 18 months or so, is enabling
the creation of broadband cellular radios in which most of the
processing occurs in digital form.
     
     Some of the first smart radios were built for the military.  In
Operation Desert Storm, the cacophony of allied combat radios-some 15
of them using a variety of frequencies, modulation techniques,
encryption codes, and waveform standards, such as AM or FM or PCM
(pulse code modulation)-created a virtual Babel in the sand.  Units
needed a separate radio system for every radio (or radar) standard.
As a result, the Pentagon launched the Speakeasy project-one smart
radio that could process all the different standards in software.
Made by Hazeltine and TRW, the first prototypes were demonstrated
successfully in 1994.  Because standards change over time and hardware
improves at the pace of Moore's law, a software programmable radio
also saves money.  Rather than upgrading the system in hardware every
time the technology changes, software radios can be upgraded merely by
downloading a new software module.
     
     Speakeasy engineers have spread the word through the cellular
industry.  Stephen Blust, now at BellSouth Wireless, is leading an
international effort to create smart radio standards-the MMITS
project.  Today, with the advance of an array of new digital
technologies, including CDMA, TDMA, GSM, DECT 1900, SMR, PHS, and a
spate of others, every urban area is becoming a Desert Storm of
incompatible radios.  Not only are these systems unable to communicate
with one another, but they also require separate spectrum and base
station equipment.  All this redundant processing has raised the costs
and reduced the universality of wireless and prevented cell phones
from displacing wireline telephony.
     
     The solution to complexity, however, is Moore's law: Put it on a
chip.  Reducing this Babel of complexity to silicon microchips, with
hundreds of millions of transistors on centimeter slivers of sand that
ultimately cost less than $2 to manufacture, smart radios can
radically simplify the cellular landscape.  Freed of most wires,
poles, backhoes, trucks, workers, engineers, and rights of way,
cellular should be far cheaper than wireline.
     
     For example, the conventional analog base station that receives
your cellular calls and connects them to the telephone network
requires a million-dollar facility of 1,000 square feet.  This
structure may contain a central- office-style switch to link calls to
the public switched telephone network, huge backup power supplies and
batteries to handle utility breakdowns, and racks of radios covering
every communications channel and modulation scheme used in the cell.
This can add up to 416 radios, together with all the maintenance and
expertise that multiple standards entail.
     
     In the near future, one wideband radio will suffice.  Digital
signal processors ultimately costing a few dollars apiece and draining
milliwatts of power will sort out all the channels, codes, modulation
schemes, multipath signals, and filtering needs.  Gone will be the
large buildings, the racks of radios, the arrays of antennas, the
specialized hardware processors.  Gone will be the virtual honeycombs
towering in the air in time and space with exclusive spectrum
assignments and time slots, and possibly gone will even be the
battalions of lawyers in the communications bar.
     
     All this apparatus can be replaced by a programmable silicon base
station in a briefcase, installed on any lamppost, elevator shaft,
office closet, shopping mall ceiling, rooftop, or even a house.  The
result, estimated Don Cox of Stanford, the father of American PCS at
Bellcore, could be a reduction of the capital costs of a wireless
customer from an average of some $5,555 in 1994 to perhaps $14 after
the turn of the century.  That is a paradigm cliff of costs.
     
     As smart radios are delivered in the first years of the new
century, they will allow escape from the zoo of conflicting protocols.
Base stations will be programmable in software, able to handle any
popular protocols, including the new technologies that will be
emerging.  The world of wireless will escape the bondage of air
standards, where if you live in a GSM (global services mobile) area,
you are forced to use GSM, and if you live in a CDMA (code division
multiple access) area, your communications-poor cousins visiting from
Europe will have to give up their GSM phone and demand to borrow yours
(will they ever give it back?).  Under the new regime, different
standards mean different software loaded into RAM (random access
memory) in real time.  Any cell can accommodate a variety of access
standards, channel assignments, and modulation schemes, and the best
ones will win.
     
FROM MICROWAVES COME TORRENTIAL BITS
     
     To get there from here, however, will require heroic achievements
in the technology of radios.  Every radio must combine four key
components: an antenna, a tuner, a mixer, and a modem.  Easiest is the
antenna.  Even though antennas too are converging with computer
technology and becoming smart, for many purposes a shirt hanger will
do the trick.  It is the other components that deliver the message to
the human ear.
     
     Tuners usually employ the science of resonant circuits to select
a specific carrier frequency or frequency band.  The cellular band,
for example, comprises 25 megahertz at around 850 megahertz.  The PCS
band comprises some 30 megahertz at around 1,950 megahertz.  A mixer
converts these relatively high microwave frequencies into an
intermediate frequency (IF) or to a baseband frequency, which can be
converted to a digital bitstream.
     
     Familiar in the PC world, a modem is a modulator-demodulator.
In transmitting, it applies an informative wiggle (AM or FM, say) to
the carrier frequency.  In receiving, it strips away the carrier,
leaving the information.
     
     In the old world of dumb radios, transceivers join all these
components into one analog hardware system.  In the new world of smart
radios, only the antenna and the front- end mixer are analog and
hardwired.  Channels, frequency bands, modulation schemes, and
protocols all can be defined in software in real time.  The radio
becomes a programmable microwave eye-a device that can see whatever
colors of RF you want to send it.
     
     The key to digital radio is the analog-to-digital converter.  It
takes a radio or intermediate frequency and samples it at least at a
rate double the frequency to translate it into a series of numbers.
Imagine a strobe light illuminating a dancer.  The light will have to
strobe at least twice as fast as the dancer moves or you will not be
able to detect the dance.  Indeed, in a phenomenon called aliasing,
you may see a different, slower dance, as you see a tire rotating
slowly in the wrong direction on a film.  In a similar way, an ADC
strobes (samples) the dance of inflected frequencies on the carrier
wave.  The resolution of the ADC is measured in bits, setting how high
the number can be that defines the waveform and, in samples per
second, determining how high a frequency the ADC can capture without
aliasing.
     
     Ultimately, early in the next century, the advance of
analog-to-digital converters will dispense even with the mixer.  Then
the all-software radio will be here.  Analog-to-digital converters
(ADCs) will be able to translate microwave frequencies directly from
the antenna into a digital bitstream.  Alcatel has already
accomplished this feat in the GSM cellular band at its labs in
Marcoussis, France.  But so far this almost totally digital radio is a
stunt rather than a product.  That will change.
     
     Most of today's ADCs cannot function reliably in real time at
microwave frequencies (above 300 megahertz).  Therefore, mixers are
vital.  Whether digital or analog, a mixer is essentially a
multiplier.  As invented by E. H.  Armstrong, the father of FM, mixers
are superheterodyne.  They use local oscillators (LOs) to multiply the
carrier frequency with a lower frequency.  The key result is a
frequency that represents the difference between the LO frequency and
the carrier.  This frequency is an intermediate frequency that holds
all the information borne by the carrier but at a level that can be
processed by existing ADCs.
     
     By far the most effective mixer is the paramixer invented by
Steinbrecher Corporation of Burlington, Massachusetts, now owned by
Tellabs and renamed Tellabs Wireless.  This device can range gigahertz
of frequencies with a spur-free dynamic range (a range of volumes
without spurious crackles or harmonics) that could capture the sound
of a pin dropping at a heavy metal rock concert.  For a fully digital
superbroadband radio, a cascade of these still- costly devices is
still the best bet.  The pioneer of this technology since it was
conceived a decade ago by MIT professor Donald Steinbrecher, Tellabs's
Burlington operation introduced the Steinbrecher MiniCell in May for
wireless local loop and interior cellular applications.
     
     Tellabs has had trouble selling its wideband radios for cellular
applications, for which they may be overdesigned.  With the increasing
spread of CDMA, which ordinarily uses only one to three channels, the
initial gains from a broadband radio are small.  But for a wireless
local loop, with many thousands of customers in the Third World using
all available channels, a broadband base station could offer large
efficiencies.  Replacing a large number of costly custom radios with
one programmable device, the MiniCell may find its niche.
     
     As ADC technology continues to advance, however, it will relieve
pressure on the mixer, opening the way to still cheaper and lower
power solutions.  With the expiration of Steinbrecher's patent on the
paramixer, the business is opening up.  Watkins-Johnson has created a
tiny mixer device in gallium arsenide the size of your smallest
fingernail.  So has Mini-Circuits of Brooklyn, New York.  "It has 50%
less performance than Steinbrecher's, but it costs only 10% as much.
Many customers say, 'It's a deal,'" observes former Steinbrecher CEO
and president R. Douglas Shute, now contemplating a startup.
     
     AD converters are now edging toward microwave frequencies.  Both
Analog Devices and Comlinear, a National Semiconductor company, have
introduced 40-megasample-per- second products at a resolution of 12
bits.  This allows more of the mixing to move into digital
multipliers.  The first of the digital downconvertor chips came from
Harris Corporation of Melbourne, Florida.  Harris now has parlayed its
expertise in RF and mixers into the creation of a sophisticated
programmable machine that demonstrates the management of multiple
modulation schemes in one cellular radio.  Introduced on the floor of
the Fifth Annual Wireless Symposium Exhibition in late February in
Santa Clara, California, the Harris smart radio showcases its
programmable HSP50214 digital downconvertor chip and is run from a PC.
With an array of displays, the machine is designed to allow
configuration and testing of smart transceivers from a Windows PC.
     
     With high-powered digital signal processors and leading- edge
ADCs, Analog Devices is a paragon of the digital radio paradigm.  At
the CTIA (Cellular Telecommunications Industry Association) meeting in
San Francisco during the first week of March, Analog introduced a
wideband smart radio tuned to the cellular band but applicable through
the PCS band as well.  A reference design to be used by infrastructure
manufacturers, it displays an array of new chips from Analog
comprising a specialized ADC called the 6600, tunable filters called
the 6620 and the 6640 that function as a digital tuner, a SHARC DSP
chip that performs the modem and channel-coding role (any advanced DSP
will do), and a "sinfully cheap" Watkins-Johnson mixer chip the size
of your fingernail.  Incorporating an automatic gain control and a
received signal strength indicator, the ADC is customized for smart
radio applications.
     
     The antenna is from Radio Shack (most any will do). From a
Windows PC using Visual Basic, Analog engineers can move from one
cellular channel to another and from GSM to CDMA to DECT 1900 to
IS-136 to the Japanese Personal Handyphone system (PHS).  As
manufacturers around the globe converge on a single intermediate
frequency of 70 megahertz, the reference radio could adapt to any
cellular band, from 850 megahertz on up.  All you would have to do is
change or retune the mixer.  According to Tom Gratzek, Analog
Devices's director of base station marketing at the Analog
communications center in Greensboro, North Carolina, customers say,
"Shazaam!"
     
THE RUSH TO CASH IN ... WHO WINS, WHO LOSES
     
     Interest is acute at all major telecom equipment manufacturers,
from Ericsson to Motorola, and champions include every telecom company
that thinks it may have guessed wrong in the GSM, TDMA, CDMA wars.
BellSouth, for example, is slipping into a GSM ghetto, but it dreams
of deploying smart radios that can play any popular standard and allow
it to filch (i.e., service) CDMA customers.  Also a TDMA orphan, AT&T
could buy cheap, all-purpose base stations that allow it to sell any
favored brand of service.  Ericsson is using the technology to create
indoor GSM base stations that can fit in a closet, and if worst comes
to worst (as it will), Ericsson will also offer CDMA, perhaps
initially as an overlay for data.
     
     By drastically enhancing efficiency in the use of spectrum,
broadband digital radios will lend new force to the industry's move up
the frequency ladder toward bandwidth abundance.  They enable the
seamless convergence of the cellular band not only with the PCS band
but also with an array of other applications such as the low-powered
ISM (industrial, scientific, and medical) bands at 900 megahertz used
by Baran's Metricom startup, the 24-gigahertz band of Associated
Communications, the 28-gigahertz band of Local Multipoint Distribution
Service (LMDS) used by CellularVision for wireless cable, and the
38-gigahertz band of WinStar.  This up-spectrum bias assures the
continued success of companies pressing the frontiers of microwave
integrated circuits, low-noise amplifiers, power amplifiers, and other
devices that function in the gigahertz.
     
     Going over the cliff of costs, the industry can introduce
radically new products.  We have just undergone the epoch of the
personal computer, climaxing in 1996 with PCs outselling TVs in units
for the first time.  We are now entering a new era when a new form of
PC will be dominant.  It may not do Windows, but it will do doors.
Tetherlessly transcending most of the limitations of the current PC
era, the most common PC will be a digital cellular phone.
     
     It will be a dataphone, as faithful readers of these pages will
know.  It will be as portable as your watch and as personal as your
wallet.  It will recognize speech and convert it to text.  It will
plug into a slot in your car and help you navigate streets.  It will
consult electronic yellow pages and give directions to the nearest gas
station, restaurant, police headquarters, or hotel.  It will collect
your news and your mail and, if you wish, it will read them to you.
It will conduct transactions and load credit into a credit chip on a
smart card, which can be used like cash.  It can pay your taxes, or
help you avoid them, or soothe you with soft music as you do your
calculus homework.  It will take digital pictures and project them
onto a wall or screen, or dispatch them to any other dataphone or
computer.  It will have an Internet address and a Java run-time engine
that allows it to execute any applet or program written in that
increasingly universal language.  Or it will dock in a more powerful
machine to perform more demanding functions.  It will link to any
compatible display, monitor, keyboard, storage device, or other
peripheral through infrared pulses or radio frequencies.
     
     And, oh yes, it will unlock your front door or car door, open
your garage door, or even play Jim Morrison songs, if you are old
enough to care for those swinging Doors of the 1960s (amazingly
enough, my teenage daughters do).
     
     Sorry, though, Nokia, your model 9000, which comes closest today
to this new machine, will not cut it, at least in the United States,
because it is based on Europe's increasingly obsolescent GSM standard.
Also offering the right form factor but the wrong access standard is
the IBM- BellSouth Simon, which is based on the U.S. analog cellular
system (AMPS) or CDPD (cellular digital packet data).  The most common
PC will not be a GSM or CDPD device, because it will soon need to
provide bandwidth on demand while draining the lowest possible power,
whenever it is not plugged in.  Thus the first PC of the new paradigm
will probably have to be CDMA, built from the bottom up to provide
bandwidth on demand, according to TCP/IP Internet standards, at a
handful of milliwatts of communications power.
     
     Among the companies soon to supply such machines, resembling the
popular U.S. Robotics Pilot, are Sony, Qualcomm, Lucky-Goldstar, and
Samsung.  In cooperation with Alcatel, the European giant, which has
just announced a CDMA program, Qualcomm base stations will soon
contain a GSM link that can allow such CDMA dataphones to tie
seamlessly to GSM systems in Europe.  This will permit European
carriers to use CDMA to expand capacity without jeopardizing their GSM
customers.
     
     Inspiring the Baran vision of wireless is the spectronic
paradigm, in which most of the industry, from personal computers to
cellular phones, moves on into the microwaves and is discussed more in
terms of megahertz and gigahertz than in the usual metrics of mips and
bits.  The spectronic paradigm tends to favor the manufacturers of
gallium arsenide, indium phosphide, and silicon germanium devices.
Even as Philips and other firms push silicon bipolar chips toward
microwave frequencies, the industry will move to higher domains of
spectrum where gallium arsenide and indium phosphide tend to prevail.
For the power amplifiers needed in every cell phone, gallium arsenide
is superior to all the silicon variants.  Pushed by the advance of the
spectronics paradigm, the current ride of Vitesse, Anadigics,
TriQuint, and other gallium arsenide innovators is likely to continue.
     
     The major long-term winner is silicon germanium.  Pioneered by
IBM fellow Bernard Meyerson and tested and sampled by Analog Devices,
silicon germanium combines much of the manufacturability of silicon
with the high-frequency operation of gallium arsenide.  IBM has
recently contracted with Hughes's communications division to develop
silicon germanium microwave devices.
     
     As the technology advances, the broadband radios will be ideal to
offer video teleconferencing, World Wide Web, and other image-rich
wireless content, including CDMA bandwidth on demand.  Data, not
voice, will be the critical application.  As people brandish their
dataphones around the globe, linking to convenient displays through IR
connectors, users can break out into a tetherless telecosm where they
can work or play, study or pray, anywhere they go.
     
     A major supplier of wireless in Third World countries may be
NextWave, the aggressive CDMA vendor for PCS, now preparing an IPO.
As a "carrier's carrier" providing only infrastructure and network
services and leaving the sales and marketing to the locals, NextWave
will join its complementary sister company in space, Globalstar, at
the heart of a CDMA fabric of culture-independent worldwide
communications.  Watch Motorola's obsolescent Iridium, with its
exclusive spectrum requirements and its effort to bypass all local
infrastructure, sink like a stone.
     
     The new paradigm of wireless joins Baran's two key
inspirations-Internet and smart radio-to burst the chains of
geography.  People who want leading-edge computers and communications
can get them wherever they may live.  Using Globalstar, Teledesic, and
other low-earth-orbit (LEO) satellite systems that will be available
as the smart radios roll out, students in the Third World can study or
work in the First World.  Teachers and entrepreneurs in the First
World can serve and employ people around the globe.  Imagined gaps
between the information rich and poor will collapse in an infoscape
equally accessible to all.
     
     Baran has not spent his life in speculation or prophecy.  Living
at the heart of Silicon Valley in a walled and radiantly flowered
community a few minutes down Middlefield Road from Netscape, Baran
sits at the epicenter of a series of entrepreneurial creations.  His
home-office PCS and Power Macs are linked to the Internet through the
Palo Alto Cable Co-op by cable modems from Com21, which he founded and
now chairs.  To run multimedia programming down twisted-pair wires,
the regional Bell operating companies now propose to use discrete
multitone technology (DMT), the basic technology conceived by Baran
for Telebit and now the leading digital subscriber loop (DSL) method,
taken up and perfected by Amati Communications, just down the road in
San Jose.  StrataCom, recently purchased by Cisco for $4 billion,
began as a leveraged buyout spinoff from Baran's Packet Technologies.
     
     Metricom, a Baran company with investments from Bill Gates, among
others, offers wireless Internet services through Baran's neighborhood
and at campuses across the country.  Baran's company, Equatorial
Communications, introduced spread spectrum commercially as a way of
delivering information from satellites below the noise floor required
by the FCC.  Spread spectrum is now, in the form of the CDMA of
Qualcomm and Globalstar, the world's fastest- growing communications
technology.  And it is the basis for the flourishing, unlicensed
wireless systems, such as Metricom, operating at less than one watt of
transmit power in the ISM (industrial, scientific, medical) bands.
     
     Collectively, the visionary concepts of this once-myopic and
still-modest engineer offer the foundation of an effort to reinvent
the Internet in an increasingly wireless form and reshape the
communications policies of the nation and the world.


                          --------------
     
     George Gilder is a contributing editor of Forbes ASAP. He
also publishes the monthly Gilder Technology Report.


     The Gilder Technology Report is designed to assist investors and
corporate decision makers in formulating strategy and tactics for the
exciting new era of technology.


     For additional information, please contact the Gilder Technology
Group by calling toll-free (888) 484-2727.  For information about GTR
and its September conference, email gtg () gilder com.


Regards,


 
                            Gordon Jacobson
                     Portman Communication Services
                            (212) 988-6288


           gaj () portman com               MCI Mail ID:  385-1533
           Home Page: http://www.seas.upenn.edu/~gaj1/home.html