This Changes . . . Everything

Tucked in the back of a low-slung building off a highway service road in Mountain View, Calif., is one of the few physical epicenters of the virtual monster that ate 1995: the Internet. Walk past a handful of windowless of-flees -- some of them populated by exhausted programmers in sleeping bags--turn left at the mountain bikes and enter the eerie, air-conditioned serenity of a small room stuffed with racks of dull metallic monitorless computers.

"This is one of the most populated nodes on the Net--there's a million visitors a day here," says Jerry Yang, cofounder of Yahoo!, an electronic guide to the Internet that has established itself as one of cyberspace's hottest addresses. Yes, the consciousness of 1 million human beings is moving through this undistinguished square of sheet rock. Such is the magic of the Net. Less than two years ago Yang was a slacker grad student at Stanford who with his friend David Filo started listing favorite destinations on the then cutting-edge World Wide Web. Now Yahoo! is a venture capital-backed corporation with a lofty business plan, marketing executives and a recent development deal with magazine giant Ziff-Davis. Yang gives speeches to audiences of gape-jawed entrepreneurs, gets profiled in People and Rolling Stone and is on the fast track to joining the burgeoning pool of Internet multimillionaires. It was as if Yang and Filo had opened a lemonade stand in a hayfield and a year later found themselves surrounded by skyscrapers. They were positioned in exactly the right place during the Year of the Internet.

Can you recall a day when there wasn't some gee-whiz Internet story in the newspapers? Was there ever a time when surfing was performed in a bathing suit, outdoors? When advertisements on buses did not emblazon a string of puzzling letters beginning with HTTP://and getting weirder from there? When Java meant coffee, and showbiz insiders used the term Web to refer to a saurian entity known as a television network? When you didn't know how toverbally articulate the @ sign? If you strain, perhaps you can remember such a time--1994. There was an Internet then, but it lurked under most of our personal radar screens. When we heard of the Information Highway, we thought of 500 channels of cable television, half of which would be home-shopping networks or pay-per-view movie channels showing Hugh-Grant comedies in staggered time slots.

But in 1995, the Internet ruled. Early on it became clear that the explosive growth of the Web--the part of the Internet that enables even neophytes to embark on digital tours of the world's computers--was the killer application that would push the already-growing Net to new levels of activity. One of the first on the bandwagon was Speaker Newt Gingrich, who fulfilled his vow to put Congress on the Web. It was part of a blitzkrieg of home pages (the opening screens of WWW sites), created by everyone from high-school students to nonprofit organizations-and especially businesses. "When we launched [late in 1994] there was no such thing as a commercial Web site," says Chip Bayers, executive editor of HotWired, Wired magazine's Web-based sibling. Now the number is in six figures. Yahoo! gets 3,000 submissions of new Web sites a day.

"I date the big transition as sometime this summer," says Eric Schmidt, VP of technology for Sun Microsystems, of the time when the Net shifted from geckhood to coolness. "One day before, the Internet was a specialized thing. Then there was a day when it got into the public consciousness. All of a sudden every business publication had the majority of its ads listing the company's URL [the arcane code that signifies a Web address]." Around that time, the stock market went bonkers with Internet fever. Netscape Communications had the most successful public offering in history; a year-old company with no earnings was instantly valued at more than $2 billion. That began a spiraling updraft in Internet stocks--Netscape would rise to more than $6 billion--creating millionaires by the bushel. (You can track these rich guys, if you want, on an Internet Millionaires home page, where the fortunes of Netscaper Marc Andreessen and other new moguls are recalculated several times daily.) It was also this summer that the media frenzy about so-called cyberporn exploded, and people began worrying whether little Stuart or Janie was using the Per-forma to download hard-core binaries from some offshore newsgroup.

By November, at the huge Comdex computer trade show, all anyone wanted to talk about was the Internet. Earlier in the year the industry talk was centered on Microsoft's power--was its domination of the computer industry so thorough that the government should break it up? Now people were wondering whether Bill Gates's company was a trapped mastodon, unable to compete in the open-standards world of the Internet. Microsoft gave its reply on Dec. 7, announcing that it was throwing all its considerable weight toward the Internet "tidal wave." It endorsed Java, Sun Microsystems' competing computer language for generating lively interactive Web pages, and announced that it would gear its applications to work with the Internet. "The Internet is pervasive in everything we're doing," said Bill Gates.

Then came the news that Microsoft would buy half of an NBC cable channel to establish a two-pronged joint venture-an all-news cable service with an Internet counterpart. Executives from both companies breathlessly described how, on the video-channel report from Bosnia, viewers would see pointers to sites on the Microsoft/NBC online venture offering "great maps" of Bosnia, and perhaps a report on the art, museum in Tuzla; It was a perfect symbol of where, in the new Info Highway wisdom, television stood in relation to the Net--Microsoft was buying a cable-TV channel to provide content for its Internet effort!

During the course of the year the discussion of the Internet ranged from sex to stock prices to software standards. But the most significant aspect of the Internet has nothing to do with money or technology, really. It's us. "The Internet mediates human interaction better than any other medium," says futurist Paul Saffo. "Getting in touch with each other is more fun than the coolest computer game, or the hottest information." Just look at the various things you can do on the Internet. You use e-mail to zip messages to friends and associates, most often at no charge per letter, sending them across the world in a few seconds. You play elaborate games on role-playing "MUDs," submersing yourself into the guise of a fantasy doppelganger, and even making virtual love with other people's jerry-built personae. You go on a Usenet newsgroup to flame the scum who disagreed with you on the virtues of last night's episode of "Deep Space Nine." You use a software browser like Netscape Navigator to cruise the Web, an awesome construct where the publishing efforts of thousands of people are interlinked into a massive seething monument to human expression, enabling everything from shopping for a new car to keeping track of Madonna's biological clock. And when you create your own Web site, you enjoy the same access to millions as do powerful entities like Sears, IBM or the U.S: government. In fact, if you didn't start a Web site in 1995, your status may be endangered. "The technology is successful because it's based on people's natural emotions, including fear, greed and vanity," says Sun's Schmidt. "They want to show off. If you don't have a Web server, you're nothing in cyberspace."

You talk about a revolution? For once, the shoe fits. "In the long run it's hard to exaggerate the importance of the Internet," says Paul Moritz, a Microsoft VP. "It really is about opening communications to the masses." And 1995 was the year that the masses started coming. "If you look at the numbers they're quoting, with the Web doubling every 53 days, that's biological growth, like a red tide or population of lemmings," says Kevin Kelly, executive editor of Wired. "I don't know if we've ever seen technology exhibit that sort of growth." In fact, there's a raging controversy over exactly how many people regularly use the Net. A recent Nielsen survey pegged the number at an impressive 24 million North Americans. But Donna Hoffman, a business professor at Vanderbilt University, charged that the Nielsen numbers were skewed toward the upscale demographic that dominates the Net, and therefore the estimate was too high.

"But there is no controversy about what online users look like," says Hoffman, explaining why businesses are desperately trying to catch the Internet wave. "They're demographically attractive--upscale, over-educated people. And the market is now moving into the mainstream--regular people are starting to come online. The Internet is clearly racing toward full-fledged status as a commercial medium."

For all of this, many people, including some experienced Net riders, don't have a good grasp of what the Internet really is. It's sort of a virtual embodiment of Gertrude Stein's description of Oakland, Calif.: there's no there . Strip away the peels of the Internet onion, and all you have are layers of technology--a bunch of rules for moving data around. These rules, or protocols, were developed by the United States government for research use, but over the past few years government support has been gradually scaled back. Users hook up to the Net through Internet service providers (ISPs) like Netcom or PSI, but those are only middlemen who hook into big regional data lines called backbones. At the top of the pyramid, there is no CEO of the Internet--the real power lies in those open protocols that ensure that all the information moves smoothly. The closest thing to a ruling body is the internet Engineering Task Force, though its influence is being overtaken by big-time commercial players. They met earlier this month in Dallas: a group of hippie-hackerish computer scientists. Many had been participants in the forerunner to the Internet: the ARPAnet, a Defense Department network that linked various research sites in the early 1970s. Their unofficial motto is emblazoned on a T shirt: WE REJECT KINGS, PRESIDENTS, AND VOTING. WE BELIEVE IN BOUGH CONSENSUS AND RUNNING CODE.

The miracle of the Internet is that credo permeates the virtual world. "There's something about the environment that tends to make people leave their existing culture at the door," says John Barlow, cofounder of the Electronic Frontier Foundation. The components of the Net ethic are easy to identify: voraciously free expression, a drive for individual empowerment, a loathing for authority and a strong libertarian strain that actually welcomes commerce--as long as it follows the live-and-let-live spirit of the Net. Indeed, as a higher share of the population gets wired, business will reshape itself to take advantage of the instant communication with customers the Net will provide.

No one really knows what it means to connect hundreds of millions of people together. Whole industries might go away, particularly those involved in modes of distribution that will evaporate when businesses can send the same materials direct to customers over the Net. New sorts of ventures will certainly emerge, but we can't be sure what they'll be. Some projections of where the Internet will take us are so sweeping that the only response is a dumb nod. "The Net will include TV, radio, all the cash-register data in the world, every traffic sensor in the world," says Wired's Kevin Kelly. "It won't be just people talking to each other. It will be people talking to machines, and machines talking to each other." If all of this is true, much of the world we know is about to fade into the rear-view mirror. Before any of this happens, however, the Internet still has serious obstacles to overcome:

Overhype. Perhaps the biggest short-term danger to the Net is the prospect of millions of new-bies jumping on the boat so fired up by, uh, laudatory magazine articles that they confuse the promise with the current reality. The former is a wonderland where setup is a breeze, Web pages load instantly, junk e-mail does not exist and you can buy any item imaginable with untraceable digital cash. The present-day reality is haffling to install, requires a love of stating at hourglass-shaped cursors and maybe lets you buy Monty Python jokes with an insecure credit-card transaction. Traveling the Net in these pioneer days is like a journey to a rugged, exotic destination--the pleasures are exquisite, but you need some stamina.

Despite this, an oceanload of serious investment is being showered onto the Internet, both in the stock market and into the development of fancy, and increasingly expensive, Web operations. (A classy site will commonly set you back six figures.) A recent study by the Yankee Group claims that most of the businesses venturing into the Net do so with "little more than a back-of-the-envelope calculation," and some don't even bother with the envelope. Zima liquor can't put interactive ads in all of these sites--what happens when the revenues don't pour in?

Regulation. Go figure--the vice president and the speaker of the House both swoon with enthusiasm about the Net, but the government's behavior toward the burgeoning Internet ethic seems more in sync with Sid, the sadistic kid next door in "Toy Story." The cyberspace crowd is most infuriated with the efforts of Sen. James Exon and Rep. Henry Hyde to ban so-called indecent speech on the Internet. Arguments rage ad infinitum over the amount of digital pictures of naked people on the Net and whether high-tech filters can enable parents to zap the filth. But the language approved by the House-Senate conference committee in early December would slap six-figure fines and jail terms for digitally uttering a nasty word.

The proponents of such censorship, urged on by Christian-right activists, make no bones about it--they do not wish to grant the same speech rights in cyberspace that are permitted in newspapers, movies, magazines and books. Despite an Internet Day of Protest where more than 20,000 people flooded congressional offices with phone calls, faxes and e-mail; it's possible that by next year plain speaking on the Net will be illegal. "People like us are going to litigate," says Marc Rotenberg, head of the Electronic Privacy Information Center. "The court is where First Amendment issues belong." In the meantime, anyone using the unrestrained language that is now as common on the Internet as those smiley-face emoticons will face serious risks. "My worst nightmare would be to have the Internet turn into something that eroded civil liberties and free speech," says Vint Cerf, an Internet pioneer who now heads MCI's efforts on the Net.

While legislative efforts to make the Net squeaky clean have gotten all the attention, the question of copyright promises to be, as Lotus Development founder Mitch Kapor puts it, "the Vietnam of the Net." The interconnectedness of cyberspace works best when there are no harriers to the free movement of words, images and sounds, but originators of these creations understandably want money for their efforts. Almost everybody agrees that new rules are required to restore some balance. But the Clinton administration's solution, outlined in a recent white paper, wants to apply the old rules, an approach that seems to side so firmly with the copy-tight owners that Net denizens are alarmed that its provisions will chill the exchange of ideas so essential to the Net. Despite the outcry, the Clintonites aren't budging. "It's not a culture clash," says Bruce Lehman, the U.S. commissioner of patents and trademarks. "It's that people are accustomed to a certain environment on the Internet and they can't quite envision a time when the Internet will be a marketplace in which people want to sell valuable products."

Security. A recent Yankelovich survey of cybersavvy respondents brought more proof of what everybody already knows: security, not porn, is the No. 1 concern of Internet users. As we rush headlong toward electronic commerce, the basic infrastructure of the Internet-which was designed to zip data around unpoliced--still hasn't been modified to make sure that snoops and thieves can't grab private information off your computers or read your e-mail. Meanwhile, dozens of companies are making plans to introduce digitized forms of money--but can we trust them?

On Dec. 10, there was yet another report of a potential hole in the Internet wall. Paul Kocher, a 23-year-old security consultant, discovered that under certain circumstances a predator, by carefully measuring the amount of time it takes a potential victim to scramble data, can get enough information to get the victim's cryptography key. Once a crook or a snoop has your key, it's easy to read all your messages and monitor your transactions. "It's a significant security problem but it can be addressed," says Kocher. Then it's on to whatever bug is discovered next. "It's a process of continual improvement," says Jim Bidzos, president of RSA Data Security Co. "Perfect security on the Internet will never exist."

Technical Overload. Will the waves of new users overwhelm the Internet? It doesn't take a stopwatch to notice that things are going s-l-o-w-e-r than they used to--despite more high-speed data "backbones" added to the Internet and a general user upgrade from pokey 9600-baud modems to faster models. Owners of popular Web sites are noticing that it takes longer for their users to download information than it took only a few months ago. Milo Medin, a vice president of @Home, a company planning to exploit high-speed cable modems on the Internet, compares the phenomenon to the heat death of the universe, where entropy dissipates the available heat to unusable levels; in this case so many people are competing for bandwidth that almost no one gets enough. Blame it on the Web--with sound, images and even video, a whizzy home page requires people to shove ever more bits through the wires, just to view family pictures or hear a punk-rock melody.

Is it possible that the whole Net might totally crash, leaving millions of computer screens with the dread "Host Contacted: Waiting for Reply" message frozen upon them? Unlikely, say the Internet wizards. "The network is wired to route around trouble," says Einar Stefferud, a networking consultant. But the Net is also prone to glitches, as occurred last spring when apparently someone in Florida trying to access a computer at MIT flubbed the process in such a way that for 30 minutes all the voluminous Internet traffic destined for MIT wound up going into a tiny wire in Florida. (Picture all the flights destined for O'Hare landing in your driveway.) Eventually, the Net will handle all these problems, but for now "there's no relief in sight," says Medin. "It's like the New York City infrastructure--you can fix things but it takes time. As fast as we network people add capacity, there's new applications."

These obstacles will have their effect on the Internet, but the expanding base of true believers is certain that the Net's growth, as well as its impact on our society, will only accelerate. Maybe the Net really is evolving to some sort of self-healing organic system, made of wires, silicon and a superb collection of human brains and emotions. Though some folks are making mil-lions--billions!--on the Net, the real fuel for the excitement is the connectedness, the thrill of putting one's own brick into the ultimate edifice of human creation. Only if this essential collaborative aspect of the Net is compromised can any company or individual dominate it. Adherents believe that the Net will never let that happen. "I have heard people say the hype can't last," says Sun's Eric Schmidt. "But so far if you were to bet on that point of view you would have lost all your money. There are stakeholders in the Internet. They fix the problems. The bandwidth isn't wide enough, we give more. If government tries to stop it, the Net reconnects around [borders]."

It's bad news for neo-Luddites and low-teachers: you'll have to put up with a continued fusillade of hyperbole about this new medium. In the next 12 months you'll be hearing plenty about "hot" Web pages, blazingly fast cable modems, 8500 Internet terminals and cyberspace coverage of the presidential election. No matter that most people in the United States have yet to log on, let alone net-surf. In 1996, maybe they will.

"If this year seemed like a big one for the Net, wait till the next one," says the EFF's John Barlow. "You ain't seen nothing yet."