Wildly optimistic data drove telecoms to build fiber glut

Of all of the myths that drove the 1990s technology boom — dot-coms made good investments, the New Economy would never experience a recession, small telecom companies could beat the mighty Bells — the most damaging may have been the fallacy that Internet traffic was doubling every three months.

The belief that Internet traffic could grow so quickly — if true, it would have meant annual growth of more than 1,000% — led more than a dozen companies to build expensive networks as they rushed to claim a piece of the next gold rush. The statistic sprouted up in reports by industry analysts, journalists and even government agencies, which repeated it as if it were the gospel truth. "Internet traffic," the Commerce Department said in a 1998 report, "doubles every 100 days."

News source: MSNBC - Wildly optimistic data drove telecoms to build fiber glut