The beginning of commercialization of the NSFnet
How is it that the networks that started out as mostly run by the government grow into the commercial entity that it is today? The answer, surprisingly, does not come entirely from any national policy, but instead from the workings of the National Science Foundationcreator of the NSFnet. Only one year after the network was started, the NSF gave a grant to Merit Network, a non-profit company consisting of University of Michigan schools and the state of Michigan, to administer the network that was being built. Around the time when the NSF contracted Merit to upgrade the network to T1 lines, MCI and IBM collaborated with Merit to form a non-profit service named Advanced Network and Services (ANS ). Later, this corporation was awarded the contract to manage the network when the contract with Merit ran out. As early as 1988 the NSF was looking into commercializing their network through conferences on "The Commercialization and Privatization of the Internet" at Harvard's Kennedy School of Government, and also on the "com-priv" Usenet list.
In 1991 the debate became more vigorous when congress considered the funding of a National Research and Education Network (NREN). The new network was to be based on existing networks, but was to operate at a much higher speed. While many in the private sector felt that there was already a technologically sufficient commercial network emerging, many in government saw that the U.S. was lagging in technology when compared to other countries.
A formal proposal was submitted
to congress for a new network to be built with government funding, but
later to be commercialized or be commercially run. After a failure in
1990, the main proponent of the proposal, Al Gore, successfully persuaded
congress to pass the High Performance Computing Act of 1991 into law.
The new law called for funding of the proposed NREN to link educational
institutions. Those arguing against the bill were expressing a growing
concern that the government was taking too large a role in the building
of the Internet, and that it was giving some an unfair advantage (Fisher
July 1991). When ANS began upgrading the network to T3 lines (also in
1991), they received permission from the government to supply more bandwidth
than the NSF required for their network. From this extra "space" on the
network they were allowed to set up their own commercial network service,
ANS CO+RE (Commercial + Research) (Messmer
Dec 1991). 