WIRED : Businesses Create Cyberspace Land Rush on the Internet

So what if it lacks the cachet of 90210? Who cares that the neighborhood is still full of nerds? An address on the Internet is the latest gotta-have status symbol in corporate America.

Once the hidden preserve of academics, scientists and defense contractors, the Internet--that grand global network of computer networks--is now the site of a cyberspace land rush, with businesses pouring onto the system in something resembling a digital stampede.

In the process, the computing world’s closest approximation of a countercultural stomping ground is being transformed into an adjunct to corporate America’s cash register--much to the displeasure of many longtime users.

Thanks mostly to businesses, a system that already reaches 15 million people worldwide is growing at the rate of perhaps a million a month. An estimated 6,500 U.S. firms, including more than half the Fortune 1000, subscribe to telecommunications services that give them an Internet mail drop, and more companies are gaining full-blown access all the time.

From Sterlington, La., Argus Chemical relies on the Internet instead of Federal Express to disseminate up-to-the-minute results of important research tests throughout its organization. The Internet, after all, is available 24 hours a day every day.

From Los Angeles, Unocal uses the Internet to transmit to remote locations any maps and land surveys needed for its oil and gas exploration. Why? The Internet spans the globe, reaching nearly 130 countries.

From New York, McGraw-Hill is trying the system to deliver some of its newsletters and magazines. At least a dozen other book publishers are openly advertising and taking orders via the Internet.

Even cable television operators, led by Tele-Communications Inc. and Time-Warner Corp., are exploring ways to offer their subscribers access to the Internet via the living room TV set.

Businesses would be pouring onto the Internet even faster if it weren’t for worries about security. Nonetheless, the rush for Internet access has been so great in recent months that some companies, including Miller Brewing Co. and retailer Nordstrom Inc., have reserved Internet addresses for potential future use.

“Remember when a fax machine seemed an option? Now everyone has one. The same holds true today for a corporate Internet address,” says Christopher Locke, a software engineer and former editor of the Internet Business Journal. “Companies that have no presence in this new arena will quickly fade from view.”

That may be hyperbole, but there’s no denying the growing importance of the Internet or the broad implications of its rising use. For any user with a personal computer and a modem, the Internet offers cheap, instant global communications.

You can use it to send a fax to Finland or locate the works of Shakespeare. You can talk to fellow orchid fanciers, find a fiance or publish your memoirs. There are perhaps 4,500 special-interest conferences--from autos to Unix, Anne Rice to Elvis. Electronic mail on the Internet can be had for less than $10 a month through a commercial service. Individuals can get access to the whole shebang for less than $20.

Businesses, by contrast, pay from $1,000 to upward of $300,000 a year, depending on their type of connection and what services they consume.

Navigating the system isn’t easy. Written by the computer literate for their own ilk, the required sequences of keyboard entries are arcane and difficult. As a result, the Internet long remained out of the reach of the uninitiated.

But over the last three years, a few entrepreneurs have gone into the business of making it easier for firms and individuals to connect to and find their way around the system. Businesses, many of them by now loaded with university graduates who were issued Internet addresses with their student cards in the 1980s, have responded enthusiastically.

“The Internet is still a long ways from being a resource for the masses,” says Vinton Cerf, the preeminent computer scientist credited with developing the Internet’s unique technology. “But it still is the closest thing we have to an advanced, public data network.”

Indeed, the Internet is a prototype of the so-called information highway touted by two of its more recent subscribers: President Clinton and Vice President Al Gore.

A 1960s-style cooperative of computers, software and telephone wires, the Internet was started by the Pentagon’s Advanced Research Projects Agency to link the Defense Department with its suppliers across the nation. Over the years, the network grew to include universities and laboratories around the world.

Like the long-distance phone network created by AT&T; at the turn of the century to tie together tiny phone companies, the critical link uniting Internet members is a common telecommunications software that bridges what would otherwise be incompatible systems. Anyone using that software gains access to the Internet.

Because it’s a network of some 12,000 smaller networks, no one owns the overall Internet. And no one really runs it--although the system is administered, in a way, by the volunteer Internet Society, based in Reston, Va. Order is maintained by local network administrators, who cooperate with one another because they benefit by doing so.

So the Net exists in a state of suspended anarchy to serve subscribers who have resisted attempts over the years to impose stricter controls on it.

From its earliest days, no idea or creation has been deemed too outlandish or extreme to be denied access. As a result, the Net has attracted an eclectic community of subscribers whose interests and pursuits range from cutting-edgemedicine to pornography, from nuclear arms to cartoons, from the latest stock market maneuverings to the hottest nightclub in New York.

Along the way, the Internet has developed what has been described as a “culture of remote intimacy,” with users employing the system to share work with far-flung colleagues and on-line discussion groups chatting electronically about a mind-boggling array of subjects.

But with the stampede of corporate America, that culture is shifting.

Clashes have erupted between the Net’s traditional users--a free-wheeling bunch who built the system based on trust and a mutual interest in research--and businesses, for which the interest is more capitalistic.

To be sure, mundane electronic chitchat still accounts for most of the network’s traffic. But business subscribers increasingly turn to the Net to handle some of their most critical corporate communications.

That the communications are so important points to what is perhaps the largest single concern among corporate users--the security risk posed by connecting their own computers to public data networks.

Using the Internet as an entry point, hackers have roamed through--and sometimes vandalized--corporate databases. Even sophisticated “fire wall” software used to seal off internal company computers from the Internet isn’t completely hacker-proof.

Equally vexing is the need to encrypt data transmissions to ensure privacy during their brief electronic journey. That creates some formidable obstacles for multinational companies operating in multiple foreign languages and limited by strict export controls on American encryption technology.

Further, as with any new communications medium, the complex legal and ethical issues surrounding copyright ownership of materials flowing across the Net’s networks must be resolved.

Until these thorny problems are settled, some corporations are limiting or barring connections to the Internet.

“Despite its potential to be the premier public long-distance data network, the Internet is still a questionable legal beast,” says Eric Fair, who carries the title of postmaster in Apple Computer’s engineering division. To protect its own computers, Apple permits only indirect access to the Internet by the bulk of its employees.

Such hurdles aside, the Internet is still considered one of the most successful transfers of technology between the defense establishment and the commercial sector.

Its wholesale conversion from a government-funded research project to an exclusively commercial service got a big boost in May, when the Clinton Administration proposed phasing out direct government financial support of Internet member networks. Instead, the government would provide funding for universities and other public agencies to use the system.

The proposed changes have sparked fears that the government eventually will eliminate as well its indirect subsidies for public agencies, leaving them potential victims of a pricing scheme geared to providing services to profit-oriented businesses.

“This network has been working perfectly for decades, and now the people who developed it are being ousted carte blanche,” complains Vigdor Schreibman, whose newsletters cater to the academic and research communities. “Business people are in business to make a profit, but profits have no place in the business of educating people. Suddenly, the whole purpose of the Internet is inverted.”

Commercial access to the Internet is available through any one of the three dozen--and still growing--private companies that have sprung up over the last few years to link businesses to the networks. Service provided by these companies now accounts for about 30% of all the traffic on the Internet, and commercial traffic represents the fastest-growing segment of network usage.

In addition, individuals can get Internet e-mail by subscribing to an on-line computer service, such as America On-Line or Compuserve. Other services, including the Well in San Francisco and Netcom in San Jose, offer full access to the Internet.

Beyond communications, the Internet is a formidable research tool. Subscribers can simply post questions or calls for help on one or more of hundreds of electronic bulletin boards, often gaining in a matter of hours what would have taken days or weeks to gather by conventional research methods.

The service can prove life-saving, as a Tokyo physician discovered a few years ago when treating a girl with a rare tropical disease. After getting a plea for help from the doctor, the World Health Organization posted an SOS on the Internet’s medical bulletin boards. Within hours, says Internet Society Vice President Anthony Rutkowski, the doctor got the responses he needed and cured his patient.

Most queries are less dramatic.

Scott Cairns, a New York software engineer, typically uses the Internet to communicate with clients in England and Japan. But Cairns has been able to indulge his passion for competitive sailing after joining an East Coast crew gathered from Internet subscribers. And before visiting someplace new, Cairns polls the Net for recommendations on golf courses.

“The advice you get on the Net tends to be pure,” he explains. “No one is being paid to say anything.”

Internet at a Glance

A network of computer networks, the Internet was born as a U.S. military research web and now spans the globe, allowing 15 million users to exchange electronic mail, confer with others who share special interests and navigate an ocean of on-line data. Lately, the complexion of the net is changing as more and more businesses use it. Nobody owns the Internet; it’s governed by the volunteer Internet Society in Reston, Va.

Commercial Usage

The vast majority of networks joining the Internet will carry business communications, the fastest-growing part of the system.

Research:

March, 1993: 3,423

Commercial:

March, 1994*: 11,211

Research:

March, 1994*: 9,415

* Projected

Top Commercial Users:

Number of computers connected, as of March 31

Hewlett-Packard: 132,243

McDonnell Douglas: 11,800

Bell Comm. Research Corp.: 5,400

Harris Corp.: 4,800

TRW: 4,600

Genentech: 4,200

Amdahl: 4,100

Xerox: 4,100

Mitre Corp.: 3,900

Honeywell: 3,400

Dell Computer: 3,400

How do Corporate Customers Use the Internet?

Data File Transfers: 45% (of traffic)

Electronic Mail: 18%

Misc, including information retrieval, video, graphics transfer: 24%

Interactive sessions: 6%

System maintenance: 7%

A Circuitous Route

The backbone of the Internet--the main switching nodes--may in time become the “information superhighway” of the future. But geographically speaking, the paths over which data travel have become less and less direct. Major Internet service providers need to resolve complex policy issues, such as how to route business data over lines reserved for academic use. The current network configuration results in curious data routing choices; the shortest distance on the Internet between Berkeley and Seattle, for instance, isn’t always a straight line.

1. Begin: Berkeley, CA

2. Connect: Santa Clara, CA

3. Connect: Washington, D.C.

4. Connect: New York, NY

5. Connect: Cleveland, OH

6. Connect: Chicago, IL

7. Connect: San Francisco, CA

8. Terminate: Seattle, WA

Sources: Information Access Technologies; Sprint; SRI International, Merit Inc.

Researched by ADAM S. BAUMAN / Los Angeles Times