The internet could suffer a dramatic slowdown by 2010 as the sheer scale of data exceeds the ability of the network to cope.

Analyst firm Nemertes Research Group has spent the past year analysing data flows over the internet and the core infrastructure that carries that information.

The company has concluded that serious bottlenecks will occur in three to five years.

"Our findings indicate that core fibre and switching/routing resources will scale nicely to support virtually any conceivable user demand," said the Nemertes report.

"But internet access infrastructure, specifically in North America, will cease to be adequate for supporting demand within the next three to five years.

"We estimate that the financial investment required by access providers to 'bridge the gap' between demand and capacity ranges from $42bn to $55bn, or roughly 60 to 70 per cent more than service providers currently plan to invest. "

The authors do not envisage that the internet will actually fail to operate, but that access times and bandwidth constraints will fall to such levels that innovation will be seriously hampered.

The next generation of YouTube, for example, would not be possible in this scenario, according to the research.

E-commerce will also be hit hard as access times will be erratic, and customers will be turned off and less able to make purchases.

Business will suffer much less, however, since most have access to fast network connections that are unavailable to consumers.

"Consumers are often not able to purchase these 'fat pipes' at any price," the report continues.

"So an additional effect of the bandwidth crunch at the edges would be to increase the gap between the 'haves' (chiefly businesses) and the 'have-nots' (chiefly consumers)."

The report echoes earlier warnings by Dr Larry Roberts who led the team that built the internet's predecessor, Arpanet.

Dr Roberts warned last month that the internet would be in trouble unless serious technological advances were achieved in networking.

• Nemertes report: The internet singularity, delayed. Why Limits in Internet Capacity Will Stifle Innovation on the Web