"The cost-competitive position of satellites will not improve by 1995 and so satellites will remain economically viable . . . only for very long distance links" says Malcolm H. Ross of Arthur D. Little International in a study done for the European Space Agency. The carefully documented study argues that fiber optic systems will become increasingly cost-competitive in the 1980s as production experience and economics of scale reduce costs. No comparable reductions in satellite costs can be expected because of the relative maturity of the existing space system technology. At present satellite communication is used for distances greater than 500 miles. In the future it may be limited to transcontinental and transoceanic data transfer.
Fiber optics is the technology of producing glass or plastic (optical) cables through which light can pass for long distances with only a slight loss of intensity. A laser is used as the light producing medium. It is possible to transmit much more information in the form of light than as electrons through conventional copper or coaxial cables of comparable diameter.
The fiber optic cables are already beginning to appear in short high-capacity communications situations. Microwave, now usually used for high traffic communications over distances of 25 to 500 miles, is also expected to be affected by the growth of fiber optic systems. The availability of competing data communication technologies should reduce prices over the long term--10 or more years. A major factor in any price reductions will be the continuation of a recent pattern of industry deregulation.
In the near term, libraries will have to continue to rely on local telephone companies and cable television companies for local data communication and on value added networks (VANS) such as Tymnet and Telenet for long-distance communications.