M points in the figure below represent the first time more than one Tbps was transmitted over transoceanic distances with single channel bit rates of 40 Gbps. The results demonstrated that it is possible (but a challenge) to use 40 Gbps per channel for transoceanic systems with capacities above 1 Tbps. The long distance fibre network can be expected to grow in both bandwidth per channel (wavelength) and number of wavelengths per fibre but projections are few due to the current bandwidth glut. In one hypothetical scenario created in 2000, it was predicted that by 2010, the bandwidth per wavelength would be 160 Gbps, for 1 000 wavelengths per fibre - that is 160 Tbps per fibre. 55 The projections above would indicate that this may be an underestimate. We thus have the capacity for massive bandwidth at low cost. If we look back, however, we can see that today's trend in investment in new technology is being governed by demand, but demand in terms of the ability to give payback on operations, rather than the original sunk cost. Parts of the industry may be indulging in creation of scarcity rents to drive up prices when there is a long distance bandwidth glut. Figure 2.11. Capacity projection for Wave Division Multiplexing (WDM) fibre, and Optical fibre Time Tivision Multiplexing (OTDM) CAPACITY IN TERABPS (Log scale) 1 000 (Petabps) Projection using log 10 estimate [source SCF Associates Ltd] 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2005 2010 2011 2012 Source: EC IST Optimist, IST Zabreb, mai 2003 (http://22.ist.optimist.org), optical networking projects EC DG INfo Soc, http:/intecweb.intec.ugent.be/list-oprimist/pdf/trends/TERENA_2003/sld023.htm. INFRASTRUCTURE TO 2030: TELECOM, LAND TRANSPORT, WATER AND ELECTRICITY - ISBN 92-64-02398-4 - © OECD 2006 2. TELECOMS INFRASTRUCTURE TO 2030 For instance, in the United States, a spending spree on long distance fibre between 1997 and 2000 was caused by a combination of the market opening effect of the 1996 Telecommunications Act and a surplus of investment capital,