When any commodity is "Free" or un-metered, demand will increase dramatically.
In the earlier days of the Internet, bandwidth was not metered very much. You paid for an Internet connection and could upload and download pretty much as fast as your 56K modem would allow you to.
But since then, connection speeds have increased, and as a result, people are uploading and downloading more data. Instead of simple ASCII pages, we send HTML. And today, increasingly, audio and video. We download entire movies.
WiFi illustrates the problem aptly. People are so used to getting "free" WiFi, and increasingly, many businesses are reining it in. Why? Because it costs money to provide this "free" connection, and when more and more people start using more and more bandwidth, the system bogs down or crashes, which means more labor costs to reset routers or more material or service costs to provide more routers and higher bandwidth connections.
When something is free - or very low priced - an economy can develop that is based on this low-cost or free commodity. In the 1960's, American car makers developed cars getting less than 10 miles per gallon. No one cared, as gas was only 25 cents a gallon. When gas prices doubled and gas stations ran out, only then did people panic. Suddenly, a commodity that was dirt cheap became dear.
All energy was the same way back then. Atomic energy would be "too cheap to meter" and cheap electricity encouraged people to do dumb things like heat their homes with resistive heating elements. The "all electric home" was touted as the wave of the future - glass boxes with little or no insulation. Cold? Just turn up the thermostat!
All that came crashing down with the energy crises of the 1970's, of course. And in terms of data, we are heading the same way.
On the "Information Superhighway" we are all driving the equivalent of an 8-mpg mid-1970's pimp barge. Ugly and ostentatious, and slathered with unnecessary doo-dads, those automotive eyesores were inefficient, ugly, and guzzled gas.
Our internet is the same way - and our computers. In the old days, you could store data in ASCII format, with eight bits per character. Word processing programs like WordPerfect added formatting codes, which increased file sizes somewhat - but still kept them down to kilobytes. Microsoft Word, on the other hand, can't seem to store even a blank document in anything less than a megabyte, as everything has "metadata" and formatting codes for everything from font size and color to page formatting and backgrounds.
The Internet has the same problem. On old ASCII newsgroups, we typed in postings in ASCII which used 8 bits per character. Today, we have HTML websites which are embedded with lines and lines of formatting codes as well as java scripts and embedded flash animation, videos, and the like.
Logging onto the bank website requires that you download a ton of data, just to ask for a few numbers (your bank balance and checks cleared). Since we have more bandwidth, and bandwidth is free, most of us don't notice this and don't complain - until we are forced into a slow-bandwidth connection like an overwhelmed router at the coffee shop.
Now bear in mind that when I say "Bandwidth" there are two definitions that come to mind. The first is the speed at which you access the Internet. Already, most ISPs are charging by speed, charging people more if they want top speeds, and less if they only need to access e-mail. This is one technique that is used to "ration" people from over-using their connection.
A second is download and upload limits - where you are charged an extra fee if your downloads or uploads exceed a certain limit every month, usually measured in Gigabytes. So far, these have proven very unpopular and hard to implement. But they are becoming more prevalent and the ISPs are threatening to enforce these limits soon, unless some agreement can be reached. Cell phone providers are already there, for the most part.
Netflix and video streaming are set to break the back of the Internet. And Internet service providers are finally saying that "too cheap to meter" is not a viable business proposition. Netflix alone accounts for the lion's share of internet traffic - just as that French Canadian who is Skyping at the coffee shop is the one hogging all the bandwidth there.
Being charged by the Megabyte or Gigabyte will become the norm, not the exception, in coming years. Already, phone companies (whose bandwidth is limited even further) are reining in "unlimited bandwidth" contracts, or making them more expensive. The trend is toward metering, and it is a trend that most of us are dreading.
The party is over. It was quite a ride.
Even assuming that the ISPs can come up with a deal with Netflix, and improved infrastructure, the problem won't go away. So long as bandwidth is "free" people will use it like water, and leave the faucet on for hours at a time. Think about it, if electricity was "free" you've never turn off your lights, and your house would be toasty warm in the winter and ice cold in the summer. It is human nature to not conserve when there are no consequences.
So long as bandwidth is free, we will continue to squander it, in new and more wasteful ways. It is not a matter of if something will happen, but when.
In the city of Atlanta, during the drought, no one conserved water when the implementation mechanism was public service announcements. When people started getting fined for watering their lawns or washing cars, people cut back. When they got $3000 water bills, they cut way back. It is human nature - we don't act until it actually costs us.
Now imagine that there was a bandwidth shortage on the Internet, what will happen?
Will we start rationing our use? Or looking for more "efficient" websites that don't squander bandwidth with unnecessary flash animation, videos, and other HTML crappy junk that doesn't add to the user experience?
I hope so. Because frankly, we need to start being more efficient in our coding. For too long, bandwidth has been free, and we've become lazy and complacent.