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 must be included when cross posting or
     uploading this article.

The following article, METCALF'S LAW AND LEGACY, was first published in Forbes ASAP, September 13, 1993. It is a portion of George Gilder's book, Telecosm, which will be published in 1996 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.

                                         METCALF'S LAW AND LEGACY


                                                 GEORGE GILDER

     The world of networks breaks into two polar paradigms.  Most
familiar is the Public Switched Telephone Network.  From the
tiniest transistor flip-flop on a modem chip through labyrinthine
layers of rising complexity on up to a 4ESS supercomputer switch
linking 107,520 telephone trunk lines (itself consisting of
millions of interconnected transistors), the public network is a
vast, deterministic web of wires and switches.  Once you are
connected in the public network, your message is guaranteed to
get through.

     In the public network, bandwidth constantly expands as you
rise in the hierarchy.  At the bottom are the twisted-pair copper
wires of your telephone that function at four kilohertz
(thousands of cycles per second).  At the top are fiber-optic
trunk lines that function at rates close to the 2.9-gigahertz
speeds of the electronic transistors that feed the glass wires.
In The Geodesic Network, writer Peter Huber has described the
five tiers of the telephone switching system as a structure with
"the solidity, permanence and inflexibility of the Great Pyramid
of Cheops, which on paper it resembled."  Although the pyramid
has suffered erosion and change in recent years, it remains
mostly in place today: the public network pyramid.

     That is one network paradigm.  The other paradigm is Robert
Metcalfe's.  It germinated in his mind in 1970 as he read a paper
by Norman Abramson of the University of Hawaii given at a
computer conference that year.  Abramson told of another
paradigm.  He called it Aloha.  With Aloha, there were no

     AlohaNet was a packet radio system used for data
communications among the Hawaiian Islands.  Packets are
collections of bits led by a header, which is a smaller
collection of bits, bearing an address; they proceed through a
communications system rather like envelopes through a postal
system.  The key feature of AlohaNet was that anyone could send
packets to anyone else at any time.  You just began transmitting.
If you didn't get an acknowledgment back, you knew the message
had failed to get through.  Presumably your packets had collided
with others.  In Metcalfe's words, "They were lost in the ether."
At that point, you would simply wait a random period (to avoid a
repeat collision as both parties returned to the channel at
once).  Then you would retransmit your message.

     To Metcalfe, AlohaNet seemed a beautifully simple network.
But Abramson showed that, because of collisions and other
problems, it could exploit only 17 percent of its potential
capacity.  A student of computer science searching for thesis
ideas, Metcalfe believed that by using a form of advanced
mathematics called queuing theory he could drastically improve
the performance of AlohaNet without damaging its essential
elegance and simplicity.  What Metcalfe, then a graduate student
at Harvard, eventually discovered would bring such networks up
toward 90 percent of capacity and make the Aloha concept a
serious threat to the entire structure of the public network

     Metcalfe's discovery is known as Ethernet.  Twenty years
later, Ethernet is the world's dominant local area network and,
at 47, Metcalfe is known and celebrated as its inventor.  He was
also founder in 1981 of 3Com Corp. of Santa Clara, Calif., the
leading producer of Ethernet adapter cards and a major
communications products company.  In this era of networking, he
is the author of what I will call Metcalfe's law of the telecosm,
showing the magic of interconnections: connect any number, "n,"
of machines - whether computers, phones or even cars - and you
get "n" squared potential value.  Think of phones without
networks or cars without roads.  Conversely, imagine the benefits
of linking up tens of millions of computers and sense the
exponential power of the telecosm.

     Indeed, the power of the telecosm reproduces on a larger
scale - by interconnecting computers - the exponential yield of
the microcosm, a law describing the near magical effect of
interconnecting transistors on chips of silicon: As increasing
numbers of transistors are packed ever closer together, the
transistors run faster, cooler, cheaper and better.  Metcalfe's
law suggests that a similar spiral of gains is available in the
telecosm of computer communications.

     Already the world economy is beginning to reap these gains.
Ethernet now links more than half of the world's 40 million
networked computers, extending Metcalfe's paradigm and his law.
Indeed, the law would suggest that in addition to his some $20
million of personal net worth from 3Com, Metcalfe's concept has
fostered scores of billions of dollars in global wealth.  Led by
Novell Inc., with an equity capitalization of more than $8
billion, the top 15 publicly traded computer networking companies
have a total market value of some $22 billion.  Add to that sum
the productivity value derived from the world's 100 million
computers as they are increasingly linked in networks, and you
may sense the power of the Metcalfe paradigm.

     Today, 20 years after Metcalfe conceived it at Xerox's Palo
Alto Research Center, Ethernet is still gathering momentum,
gaining market share and generating innovations.  Between 1989
and 1993, the percentage of America's computers on LANs rose from
less than 10 to more than 60, and most of these gains were in

Ether Moves to Cable

     The telecosm's powers could end up saving the American
economy from itself.  In an era when the new payroll taxes and
regulations of Clintonomics could end up driving millions of mind
workers back into their homes, Digital Equipment Corp. is now
extending Ethernet's range from its current two-mile limit to
some 70 miles.  Called Channelworks, the DEC system can run
Ethernet on the some 50 million miles of cable television coax.
This will enable potential scores of millions of telecommuters to
access their familiar office LAN, tap their company E-mail and
their corporate databases, and generally make themselves feel at
work while at home.  Deployed at a profit and extended to
customers at a flat monthly rate, Ethernet in the neighborhood
could become a massive growth business for the cable industry
over the next decade.

     As Ethernet spreads and faces the challenge of remote work
teams using digital images, simulations, maps, computer-assisted
design schematics, visualizations, high-fidelity sounds and other
exotic forms of data, the system is constantly adapting.  From
3Com spin-offs Grand Junction Networks and LAN Media Corp.  to
smart hubmaker David Systems, from Kalpana to Synernetics, from
National Semiconductor to Hewlett Packard, from Cabletron to
SynOptics, from AT&T even to Token Ring leader IBM, scores of
companies are pushing Ethernet into new functions and performance
levels.  It is emerging in full-duplex, multimedia, fast, fiber-
optic, shielded, unshielded, twisted, thin, thick, hubbed,
collapsed, vertebrate, invertebrate, baseband, broadband, pair,
quartet, coaxial and wireless versions.  It now can run at 2.9,
10, 20 and 100 megabits per second.  It has moved from 2.9
megabits per second to 100 megabits per second and from a few
hundred to several million users in some 10 years.  At its
present pace of progress, Ethernet will someday run isochronous
(real-time) gigabits per second on linguine.

Aloha ATM, Gushing Cash

     So why is its boyish-looking inventor - over Metcalfe's
anguished protests, think of Ted Kennedy some 10 years ago -
giving up on his baby just as it enters its roaring 20s?  Why is
he ready to abandon his basic paradigm in favor of a return to
the public network vision of massive, intelligent switching
systems?  Why is he now talking of Ethernet as a "legacy LAN"?

     Discoursing this summer from a deck chair on his yacht (a
converted lobster boat) as he breezed down from his Maine retreat
to a dock on the Charles River for his 25th MIT reunion, Metcalfe
has the air of an elder statesman.  Though humbly grateful for
the benisons of Ethernet, he has seen the future in a poll of
experts prophesying the universal triumph of a powerful new
switching system called asynchronous transfer mode (ATM).  "I
have found," Metcalfe solemnly intones, "an amazing consensus
among both telephone industry and computer networking experts
that ATM is the future of LANs."  Aloha, ATM.

     Metcalfe is not alone among Ethernet pioneers flocking back
to Ma Bell's pyramid of switches.  Also leaving Ethernet behind
is his onetime nemesis, Leonard Kleinrock of UCLA, a leading guru
of gigabit networks who helped define the mathematical limits of
Ethernet, and is given credit (or is it blame?) for naming its
Carrier Sense Multiple Access/Collision Detection protocol
(CSMA/CD).  Preparing to defect to ATM is Ronald Schmidt, the
brilliantly ebullient technical director of SynOptics, who
created the latest Ethernet rage - sending the signals over
telephone wire under the 10baseT standard (10 megabits of
baseband data over twisted pair).

     There has not been such a stampede to a new standard since
the global rush to ISDN (Integrated Services Digital Network) in
the early 1980s.  Offering digital phone lines at 144 kilobits
per second, ISDN is just now coming on-line in time to be aced by
the megabits per second of Ethernet over cable.

     In a prophetic memo launching the concept in 1973, Metcalfe
foreshadowed the secret of Ethernet's success.  He wrote: "While
we may end up using coaxial cable trees to carry our broadcast
transmissions, it seems wise to talk in terms of an ether, rather
than `the cable'....  Who knows what other media will prove
better than cable for a broadcast network: maybe radio or
telephone circuits, or power wiring, or frequency-multiplexed
cable TV or microwave environments, or even combinations thereof.
The essential feature of our medium - the ether - is that it
carries transmissions, propagates bits to all stations."  In
other words, it is the stations, rather than the network, that
have to sort out and "switch" the messages.

     The word Ethernet may be capitalized to signify the official
standard of CSMA/CD.  Or it may be lowercased to suggest a medium
without switches, routers and other intelligence.  In either
case, the word "ether" conveys the essence of the ethernet.  An
ether is a passive, omnipresent, homogeneous medium.  Long
believed essential for the propagation of electromagnetic waves,
the literal existence of an ether was disproven in the late 19th
century by the famous experiments of Albert Michelson and Edward
Morley.  But the concept of a figurative ether - a dumb medium of
propagation - survives in modern communications.

     The enduring magic of ethernets stems from the law of the
microcosm, favoring distributed terminals over centralized
hierarchies, peer networks of PCs over mainframe pyramids.  The
microcosm's relentless price/performance gains on chips have
endowed Metcalfe's peer-to-peer scheme with ever more powerful
peers, at ever lower prices.  Medium-independent from the outset,
the Metcalfe systems do not require central switching.  In an
ethernet system the intelligence is entirely in the terminals,
not in the network itself, and most of the bandwidth is local
(where some 80 percent of traffic resides).

     Although this ATM is expected to gush jackpots of cash for
gaggles of network companies and investors, it is unrelated to
its acronymic twin, automatic teller machines.  Think of ATM
rather as an automated postal center that takes messages (of any
size or addressing scheme), chops them up, puts them into
standardized little envelopes and figures the best routes to
their destinations in billionths of a second.  The magic of ATM
comes from restricting its services to those uniform envelopes
(called cells) of 53 bytes apiece (including a five-byte address)
and creating for each envelope what is called a virtual circuit
through the network.  These features make it unnecessary for
intermediate switches in the network to check the address; the
cell flashes through the system on a precomputed course.

     A compromise defined by phone companies as the longest
packet size that can handle voice in real time, 53-byte cells are
also short enough to be entirely routed and switched in cheap
hardware; i.e., microchips.  This means that the ATM postal
center can function at speeds of up to 155 megabits per second or
even higher.  Perhaps most attractive of all, ATM can handle
multimedia data, such as digital movies or teleconferences, with
voice, text and video that must arrive together at the same time
in perfect sync.  As the world moves toward multimedia, the
industry is flocking toward ATM, the innovation that can make it

Ethernet: A Legacy LAN?

     By contrast, Ethernet seems old and slow: the vacuum tube of
computer communications.  Think of it, crudely, as a system where
all the messages are cast into the ocean and picked up by
terminals on the beach which scan the tides for letters addressed
to them.  Obviously, this system would work only if the beach
terminals could suck up and filter tremendous quantities of sea
water.  The magic of ethernet comes from the ever growing power
of computer terminals.  The microcosm supplies sufficiently
powerful filtering chips - chiefly digital signal processors
improving their powers some tenfold every two years - to sort
mail and messages in the vasty deep.  This is quite a trick.  To
the experts, it seems unlikely to prevail for long against the
fabulously swift switching of ATM.

     True, there is some confusion about just how, where and when
this miracle cure will arrive.  The industry's leading
intellectual, Robert Lucky of Bellcore - a paragon of long-
distance networks - predicts that ATM will come first in local
area networks, while Metcalfe, of local area network fame, thinks
it will come first in wide area networks.  James Chiddix of Time-
Warner Cable is probably right in predicting digital cable pay-
per-view as the first big ATM customer, using it for broadcasting
films in his 500-channel digital cable TV project in Orlando.
But most experts agree that one way or another ATM will blow away
Ethernet during the next decade or so.

     Nonetheless, as usual, conventional wisdom is wrong.
Ethernet is quietly preparing for a new era of hegemony in the
marketplace for computer connections.

     The reason Ethernet prevailed in the first place is that, in
the words of Ronald Schmidt, "it was incredibly simple and
elegant and robust."  In other words, it is cheap and simple for
the user.  Customers can preserve their installed base of
equipment while the network companies innovate with new
transmission media.  When the network moves to new kinds of
copper wires or from one mode of fiber optics to another,
Ethernet still looks essentially the same to the computers
attached to it.  Most of the processing - connecting the user to
the network, sensing a carrier frequency on the wire and
detecting collisions - can be done on one Ethernet controller
chip that costs a few dollars.

     As Metcalfe described the conception of this technology in
1981, "I explored the advantages of moving the transceiver down
out of the ceiling onto the adapter board in the host computer.
I had seen many actual Ethernet installations in which our brick
transceivers were not up in the ceiling tapping into the ether
cable, as they were supposed to be...but instead were on floors
behind computers, dropped in the centers of neatly coiled
transceiver cables....  We were discovering that the people
buying personal computers and workstations in those days were not
generally the same kind of people who were allowed to remove
ceiling tiles and string cables through conduits....  The
personal computer revolution was taking place in organizations
from the bottom up....  It was time for Ethernet to be re-
invented for bottom-up proliferation among the personal computer
work group revolutionaries."

     Using "silicon compiler" design tools to radically reduce
the time to market, Seeq Technology created an Ethernet chip for
PCs in time for a single-board version of the interface unit.
Putting the transceiver on the adapter board eliminated a special
transceiver cable and drastically simplified the system.  There
is no bulky connection between the coding device preparing
information for the network and the transceiver sending or
receiving the signals on the net.  All this processing is done in
the computer, on one printed circuit board, now reduced to the
size of a credit card.  While its rival from IBM - Token Ring -
requires a mostly proprietary array of token-passing managers,
clocking assignments and other complexities, Ethernet is an open
system.  Relative to the alternatives, it offers the possibility
of something near plug-and-play.  So advantaged, Ethernet has
overcome IBM's Token Ring, 20 million nodes to 8 million in
installed base.

     But this does not persuade Ethernet pioneers Bob Metcalfe,
Leonard Kleinrock and Ronald Schmidt.  Because ATM can handle all
kinds of data fast, Metcalfe sees it as the "grand unifier"
bringing together WANs and LANs and effecting a convergence of
television, telephony and computing in turbulent multimedia bit
streams bursting into our lives early next century.  "And of all
the variations of multimedia," he writes in Infoworld - Metcalfe
is now its publisher - "the one that will drive ATM is personal
computer video conferencing - interactive, two-way, real-time,
integrated digital voice, video and data."  Although Ethernet
will persist as a "legacy LAN," he says, it cannot compete with
ATM in these crucial new roles.  Schmidt makes the same essential
case, stressing the need for switch-based architectures in a
world of exotic new media.

Kleinrock's Formula

     Why the pessimism on Ethernet?  Bringing mathematics to bear
on the argument, Kleinrock declares that the collision-detecting
functions of Ethernet bog down with large bandwidths, short
packets and long distances.  Thus, the system must fail with the
onset of fiber highways across the land.  The oceans of Ethernet
will simply grow too large to allow efficient detection of
collisions in its depths.  With large bandwidths, more packets
can be pumped into the wire or glass before a collision is
detected; by that time, most of the transmission is finished.
When the distances get too long, collisions can occur far from
the transmitting computer and take longer to be detected.  The
shorter the packets, the worse these problems become.

     As Kleinrock computes these factors, the efficiency of
Ethernet is roughly a function (a), computed as five times the
length of the line in kilometers times the capacity of the system
in megabits per second, divided by the packet size in bits.  When
a exceeds a certain level (Kleinrock sets it at 0.05), Ethernet's
efficiency plummets.

     With ATM packet sizes needed for voice traffic - or even at
the minimum Ethernet packet size of 72 bytes - any Ethernet with
a capacity much higher than 10 megabits per second exceeds this
tipping point.  Therefore, high-speed Ethernets must either use
packets too long for voice or shrink in extent to far less than
three kilometers.  This is what Howard Charney's Grand Junction
and its rival LAN Media propose with Fast Ethernet.  Noticing
that 10baseT hubs have reduced the length of Ethernet connections
by a factor of 10, Ron Crane, founder of LAN Media, suggests that
this change allows acceleration of the system by an equal amount:
to 100 megabits per second.

     But this seems a one-time fix that fails to address the
multigigabit world of fiber optics.  At some point, Kleinrock,
Schmidt and Metcalfe agree, ad hoc fixes will begin to fail and
ATM (or possibly some other system) will begin to prevail.  Using
Kleinrock's formula, that point is here today, with 100-megabit-
per-second Ethernet lines.

     As an increasing share of network traffic takes the form of
pictures, sounds, simulations, three-dimensional visualizations,
collaborative work sessions, video teleconferences and high-
resolution medical images, the Ethernet model already seems to be
foundering, according to many expert projections.  The triumph of
ATM, so it would seem, is just a matter of time.

     Time, however, is precisely what is absent from all these
projections.  Ethernet is a system based on the intelligence of
terminals; ATM is a system based on the intelligence of switches
and networks.  All the arguments for ATM miss the law of the
microcosm: the near annual doubling of chip densities, the
spiraling increase of computer power surging on the fringes of
all networks as transistor sizes plummet over the next decade.

The Power of Exponents

     Amazingly, most technology prophets fail to come to terms
with the power of exponents.  You double anything annually for
long - whether deforestation in ecological nightmares or
transistors on silicon in the awesome routine of microchip
progress - and you soon can ignite a sudden moment of
metamorphosis: a denuded world or a silicon brain.

     Shortly after the year 2000, semiconductor companies will
begin manufacturing microchips with more than a billion
transistors on them - first as memories, and soon after as
processors.  A billion transistors could accommodate the central
processing units of 1,000 Sun workstations or 16 Cray
supercomputers.  This means roughly a millionfold rise in the
cost-effectiveness of computing hardware over the next decade or

     Intelligence in terminals is a substitute for intelligence
in networks; switching and routing functions migrate from the
center of the web to the increasingly powerful computers on its
fringe.  Looming intelligence on the edge of the network will
relieve all the current problems attributed to ethernets and will
render the neatly calculated optimizations of ATM irrelevant.

     Meanwhile, the law of the telecosm is launching a similar
spiral of performance in transmission media, ultimately
increasing their bandwidth, also by a factor of millions.
Bandwidth is a replacement for switches.  If you can put enough
detailed addressing, routing, prioritization and other
information on the packets, you don't have to worry about
channeling the data through ATM switches.  The emergence of dumb,
passive all-optical networks with bandwidths some ten-
thousandfold larger than existing fiber optics will obviate much
of the pressure on switches.  Combining microcosm and telecosm in
explosive convergence makes it nothing short of ridiculous to
expect a system optimized for 1995 chip densities and fiber
capacities to remain optimal in 2013, when Metcalfe foresees the
final triumph of ATM, or even in 2001.

     Of course, ATM will be useful in various applications before
then.  Sun and SynOptics envisage putting ATM ports in future
workstations where ISDN ports mostly languish today.  AT&T, MCI,
Sprint and Wiltel will incorporate ATM switches in their long-
distance networks.  Time-Warner may indeed use them for
distributing movies.  In general, however, companies that rely on
an apparent trend toward centralized switches will be

     Cable firms will do better by sticking to the ethernet
paradigm of dumb bandwidth that has made them the envy of all in
the emerging era of digital video.  IBM and other computer firms
with powerful ethernet and fiber technologies should not rush to
adopt the public network paradigm.  Telephone companies in
particular should maintain an acute interest in their ongoing
experiments with all-optical networks and other passive optical
technologies.  Any near-term successes of ATM, afflicted with the
many glitches and growing pains of any new technology, are likely
to come too slowly to deflect the continuing onrush of ethernets.

     Ethernet prevails because it is dumb.  In the old world of
dumb terminals - whether phones, IBM displays or boob tubes - a
network had to be smart.  There was time even to put human
operators into the loop, and a need to concentrate programming at
one central location.  But in the emerging world of
supercomputers in your pocket or living room, networks will have
to be dumb bandwidth pipes.  What the coming array of desktop
supercomputers and cheap massively parallel servers will need is
passive dark fiber, mostly unlit by switching intelligence.  Dark
fiber can allow for the huge variety of data forms and functions,
protocols and modulation schemes that is emerging in the new era
of convergence between phones and computers.

     Ethernet is the protocol for a dumb pipe, a passive ether.
That is why it fits so well on a cable TV line and why it will
fit even into the multigigabit world of a multimedia future.

The Return of Aloha

     The dumb networks of the fibersphere will be ethernets.
These all-optical links that have been made possible by the
creation of erbium-doped amplifiers and other passive devices
give access to the full 25,000-gigahertz bandwidth of fiber
optics (see "Into the Fibersphere," December 7, 1992).  In these
networks, fiber changes from a substitute for copper to a
substitute for air.  Just as the microcosm put entire computer
systems on single slivers of silicon, the telecosm will put
entire communications systems on seamless webs of silica.
Terminals will tune into the infrared colors of the fibersphere
like radios tuning into the frequencies of AM or FM.

     As chips and fiber are hugely expanding their performance
and bandwidth, information traffic is rapidly migrating from the
wires to the air.  Although many experts contend that the radio
frequencies in the air - the electromagnetic spectrum - are
running out, communications systems now use only a tiny sliver of
spectrum, well under one percent of the usable span.  As shown by
Cellular Vision's success in sending cable TV signals over the
air at 28 gigahertz, it is now possible to move up the spectrum
into the vast domains of microwaves; other experiments show that
network traffic in these portions of the spectrum can be
accommodated with error rates of less than one in a billion,
enough to avoid extensive error correcting.

     At the same time, the replacement of today's 30-mile cells
with tomorrow's closely packed microcells means an exponential
rise in available spectrum and an exponential reduction in power
usage.  The replacement of analog systems with digital systems
using code division multiple access (CDMA) will allow the reuse
of all frequencies in every cell, thus further expanding
available spectrum (see "New Rules of Wireless," March 29, 1993).
A company called ArrayCom in Santa Clara, Calif., is developing a
new system, called spatial division multiple access (SDMA), based
on smart antennas that can follow an individual communicator as
it moves through a cell.  This technology would allow the use of
all the available spectrum by each "phone."

Back to the Real "Ether" Net

     Inspired by a radio network, ethernet is well adapted for
this new world of wireless.  The increasing movement of data
communications into the air - the real ether - will give new life
to Metcalfe's media-independent system.  Cellular systems already
operate with protocols similar to CSMA/CD.  As microcells fill up
with digital wireless traffic, all networks will increasingly
resemble the most popular computer networks.  In the ether, links
will resemble ethernets far more than ATMs.

     The coming age of bandwidth abundance in glass and in air
converges with an era of supercomputer powers in the sand of
microchips.  We should build our systems of the future - the
cathedrals of the Information Age - on this foundation of sand.
It will not disappoint us.

     Whether in glass or in air, the basic protection of Ethernet
is not smarts but statistics.  Ethernet is a probabilistic
system.  This fact has caused endless confusion.  Because a
probabilistic system cannot guarantee delivery of data on a
specific schedule, or at all, many experts have concluded that
Ethernet is unsuited for critical functions, or for isochronous
data inherent in multimedia - with voice and video that must
arrive in real time.  When and whether anything arrives is a
stochastic matter.

     Nonetheless, if there is enough bandwidth for the
application, ethernets work just as reliably and well as their
deterministic rivals, even for advanced video traffic.  As
Kleinrock observes, for many image applications, very long
packets can be as effective as very short ones.  The long packets
become a virtual circuit connection, somewhat like a phone call.
It is likely that perhaps 80 percent of all multimedia will be
sent in burst mode, with a store-and-forward protocol, rather
than isochronously in real time.  Broadband ethernets will be
better for burst mode than ATM's short packets.

     In any case, the combination of intelligence at the
terminals and statistics in the network is more robust than the
mechanistic reliability of Token Rings or ATM switches.  As
Metcalfe points out in explaining the triumph of his vision over
Token Ring, Ethernet is a simple system that is stabilized by its
own failures.  The CSMA/CD algorithm uses collision detection in
a negative feedback loop that delays retransmission in
exponential proportion to the number of collisions, which is a
reliable index of the level of traffic.  Thus thriving on a worst-
case assumption of frequent failure, Ethernet has outpaced all
rivals that guarantee perfect performance and depend on it.

Metcalfe's Law: Transcending His Own Doubts

     Now, in ATM, Ethernet is faced with a new paragon of
determinism offering high speeds and rigorous guarantees, a new
version of the public network paradigm, a new pyramid of
switching power.  But Metcalfe's law and legacy may well win
again, in spite of his own defection.

     As Metcalfe explains, "Ethernet works in practice but not in
theory."  The same could be said of all the devices of the
microcosm and telecosm.  Both of the supreme sciences that
sustain computer and communications technology - quantum theory
and information theory - are based on probabilistic rather than
deterministic models.  They offer the underpinnings for an age of
individual freedom and entrepreneurial creativity.

     Humankind's constant search for deterministic assurance
defies the ascendant science of the era, which finds nature
itself as probabilistic.  To Einstein's disappointment, God
apparently does throw dice.  But chance is the measure of human
ignorance and the mark of divine knowledge.  Chance thus is the
paradoxical root of both fate and freedom.

     Nations and networks can win by shunning determinism and
finding stability in a constant shuffle of collisions and
contentions in ever expanding arenas of liberty.

     Because of an acceptance of setbacks, capitalist markets are
more robust than socialist systems that plan for perfection.  In
the same way, successful people and companies have more failures
than failures do.  The successes use their faults and collisions
as sources of new knowledge.  Companies that try to banish chance
by relying on market research and focus groups do less well than
companies that freely make mistakes and learn from them.

     Because of an ability to absorb shocks, stochastic systems
in general are more stable than deterministic ones.  Listening to
the technology, we find that ethernets resonate to the deepest
hymns and harmonies of our age.