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Chapter 5 - Data Communications: Market Competition 1969-1972

5.14 In Perspective

A right combination of incentive and opportunity opened a market window for entrepreneurial access in data communications between 1968-1972. The results: a burst of new firms introducing modems and/or multiplexers. Thus, in four short years, data communications went from domination by one firm, AT&T, offering a minimal number of products, to nearly one hundred firms and over two hundred products. Then as suddenly as the market window had opened, it would close by 1974. Investment capital would dry up and the perceived market opportunity would vanish. Not until the end of the 1970’s would there be another surge of growth for computer communications products.

And when the next surge of companies happens, it will not be the data communication firms that dominated, but rather a new population of companies selling local area networking, or simply networking. As an idea, networking would grow out of the work begun at the end of 1968 under the auspices of ARPA’s IPTO. ARPANET would change the vision of computer communications from sending bits to sending messages. The story of the ARPANET is next, a history covering the same years as the chapter just read.