History of the Internet
The history of the Internet dates back to the early development of communication networks. The idea of a computer network intended to allow general communication between users of various computers has developed through a large number of stages. The melting pot of developments brought together the network of networks that we know as the Internet. This included both technological developments and the merging together of existing network infrastructure and telecommunication systems.
The earliest versions of these ideas appeared in the late 1950s. Practical implementations of the concepts began during the late 1960s and 1970s. By the 1980s, technologies we now recognize as the basis of the modern Internet began to spread over the globe. In the 1990s the introduction of the World Wide Web (WWW) saw its use become commonplace.
The infrastructure of the Internet spread across the globe to create the world wide network of computers we know today. It spread throughout the Western nations and then begged a penetration into the developing countries, thus creating both unprecedented worldwide access to information and communications and a digital divide in access to this new infrastructure. The Internet went on to fundamentally alter and affect the economy of the world, including the economic implications of the dot-com bubble.
Before the Internet
A lack of inter-networking
Prior to the widespread inter-networking that led to the Internet, most communication networks were limited by their nature to only allow communications between the stations on the network. Some networks had gateways or bridges between them, but these bridges were often limited or built specifically for a single use. One prevalent computer networking method was based on the central mainframe method, simply allowing its terminals to be connected via long leased lines. This method was used in the 1950s by Project RAND to support researchers such as Herbert Simon, in Pittsburgh, Pennsylvania, when collaborating across the continent with researchers in Santa Monica, California, on automated theorem proving and artificial intelligence.
Three terminals and an ARPA
A fundamental pioneer in the call for a global network, J.C.R. Licklider, articulated the idea in his January 1960 paper, Man-Computer Symbiosis.
"a network of such [computers], connected to one another by wide-band communication lines" which provided "the functions of present-day libraries together with anticipated advances in information storage and retrieval and [other] symbiotic functions. " -- J.C.R. Licklider 
In October 1964, Licklider was appointed head of the United States Department of Defense's DARPA information processing office, and formed an informal group within DARPA to further computer research. As part of the information processing office's role, three network terminals had been installed. One for System Development Corporation in Santa Monica, one for Project Genie at the University of California, Berkeley and one for the Multics project at the Massachusetts Institute of Technology (MIT). Licklider's need for inter-networking would be made evident by the problems this caused.
"For each of these three terminals, I had three different sets of user commands. So if I was talking online with someone at S.D.C. and I wanted to talk to someone I knew at Berkeley or M.I.T. about this, I had to get up from the S.D.C. terminal, go over and log into the other terminal and get in touch with them. I said, oh, man, it's obvious what to do: If you have these three terminals, there ought to be one terminal that goes anywhere you want to go where you have interactive computing. That idea is the ARPAnet." -- Robert W. Taylor, co-writer with Licklider of "The Computer as a Communications Device", in an interview with the New York Times 
At the core of the inter-networking problem lay the issue of connecting separate physical networks to form one logical network. During the 1960s, several groups worked on and implemented packet switching. Donald Davies (NPL), Paul Baran (RAND Corporation) and Leonard Kleinrock (MIT) are credited with the simultaneous invention. The common myth that the Internet was developed to survive a nuclear attack has its roots in the early theories developed by RAND. Baran's research had approached packet switching from studies of decentralisation to avoid combat damage compromising the entire network. 
Networks that led to the Internet
Promoted to the head of the information processing office at ARPA, Robert Taylor intended to realize Licklider's ideas of an interconnected networking system. Bringing in Larry Roberts from MIT, he initiated a project to build such a network. The first ARPANET link was established between the University of California, Los Angeles and the Stanford Research Institute on 21 November 1969. By 5 December 1969, a 4-node network was connected by adding the University of Utah and the University of California, Santa Barbara. Building on ideas developed in ALOHAnet, the ARPANET started in 1972 and was growing rapidly by 1981. The number of hosts had grown to 213, with a new host being added approximately every twenty days.  
ARPANET became the technical core of what would become the Internet, and a primary tool in developing the technologies used. ARPANET development was centered around the Request for Comments (RFC) process, still used today for proposing and distributing Internet Protocols and Systems. RFC 1, entitled "Host Software", was written by Steve Crocker from the University of California, Los Angeles, and published on April 7, 1969. International collaborations on ARPANET were sparse. For various political reasons, European developers were concerned with developing the X.25 networks. Notable exceptions were the Norwegian Seismic Array (NORSAR) in 1972, followed in 1973 by Sweden with satellite links to the Tanum Earth Station and University College London.  These early years were documented in the 1972 film Computer Networks: The Heralds of Resource Sharing.
X.25 and public access
See main articles at X.25, Bulletin board system and FidoNet.
Following on from DARPA's research, packet switching networks were developed by the International Telecommunication Union (ITU) in the form of X.25 networks. In 1974, X.25 formed the basis for the SERCnet network between British academic and research sites, which would later become JANET. The initial ITU Standard on X.25 was approved in March 1976.
The British Post Office, Western Union International and Tymnet collaborated to create the first international packet switched network, referred to as the International Packet Switched Service (IPSS), in 1978. This network grew from Europe and the US to cover Canada, Hong Kong and Australia by 1981. By the 1990s it provided a worldwide networking infrastructure. 
Unlike ARPAnet, X.25 was also commonly available for business use. X.25 would be used for the first dial-in public access networks, such as Compuserve and Tymnet. In 1979, CompuServe became the first service to offer electronic mail capabilities and technical support to personal computer users. The company broke new ground again in 1980 as the first to offer real-time chat with its CB Simulator. There were also the America Online (AOL) and Prodigy dial in networks and many bulletin board system (BBS) networks such as The WELL and FidoNet. FidoNet in particular was popular amongst hobbyist computer users, many of them hackers and radio amateurs.
In 1979, two students at Duke University, Tom Truscott and Jim Ellis, came up with the idea of using simple Bourne shell scripts to transfer news and messages on a serial line with nearby University of North Carolina at Chapel Hill. Following public release of the software, the mesh of UUCP hosts forwarding on the Usenet news rapidly expanded. UUCPnet, as it would later be named, also created gateways and links between FidoNet and dial-up BBS hosts. UUCP networks spread quickly due to the lower costs involved, and ability to use existing leased lines, X.25 links or even ARPANET connections. By 1983 the number of UUCP hosts had grown to 550, nearly doubling to 940 in 1984.
Merging the networks and creating the Internet
Map of the TCP/IP test network in January 1982With so many different network methods, something needed to unify them. Robert E. Kahn of DARPA and ARPANET recruited Vint Cerf of Stanford University to work with him on the problem. By 1973, they had soon worked out a fundamental reformulation, where the differences between network protocols were hidden by using a common internetwork protocol, and instead of the network being responsible for reliability, as in the ARPANET, the hosts became responsible. Cerf credits Hubert Zimmerman and Louis Pouzin (designer of the CYCLADES network) with important work on this design. 
With the role of the network reduced to the bare minimum, it became possible to join almost any networks together, no matter what their characteristics were, thereby solving Kahn's initial problem. DARPA agreed to fund development of prototype software, and after several years of work, the first somewhat crude demonstration of what had by then become TCP/IP occurred in July 1977. This new method quickly spread across the networks, and on January 1, 1983, TCP/IP protocols became the only approved protocol on the ARPANET, replacing the earlier NCP protocol. 
ARPANET to NSFNet
After the ARPANET had been up and running for several years, ARPA looked for another agency to hand off the network to; ARPA's primary business was funding cutting-edge research and development, not running a communications utility. Eventually, in July 1975, the network had been turned over to the Defense Communications Agency, also part of the Department of Defense. In 1984, the U.S. military portion of the ARPANET was broken off as a separate network, the MILNET.
The networks based around the ARPANET were government funded and therefore restricted to noncommercial uses such as research; unrelated commercial use was strictly forbidden. This initially restricted connections to military sites and universities. During the 1980s, the connections expanded to more educational institutions, and even to a growing number of companies such as Digital Equipment Corporation and Hewlett-Packard, which were participating in research projects or providing services to those who were.
Another branch of the U.S. government, the National Science Foundation (NSF), became heavily involved in internet research and started development of a successor to ARPANET. In 1984 this resulted in the first Wide Area Network designed specifically to use TCP/IP. This grew into the NSFNet backbone, established in 1986, and intended to connect and provide access to a number of supercomputing centers established by the NSF.
The transition toward an Internet
It was around the time when ARPANET began to merge with NSFNet, that the term Internet originated, with "an internet" meaning any network using TCP/IP. "The Internet" came to mean a global and large network using TCP/IP, which at the time meant NSFNet and ARPANET. Previously "internet" and "internetwork" had been used interchangeably, and "internet protocol" had been used to refer to other networking systems such as Xerox Network Services.
As interest in wide spread networking grew and new applications for it arrived, the Internet's technologies spread throughout the rest of the world. TCP/IP's network-agnostic approach meant that it was easy to use any existing network infrastructure, such as the IPSS X.25 network, to carry Internet traffic. In 1984, University College London replaced its transatlantic satellite links with TCP/IP over IPSS.
Many sites unable to link directly to the Internet started to create simple gateways to allow transfer of e-mail, at that time the most important application. Sites which only had intermittent connections used UUCP or FidoNet and relied on the gateways between these networks and the Internet. Some gateway services went beyond simple e-mail peering, such as allowing access to FTP sites via UUCP or e-mail.
TCP/IP becomes worldwide
The first ARPANet connection outside the US was established to NORSAR in Norway in 1973, just ahead of the connection to Great Britain. These links were all converted to TCP/IP in 1982, at the same time as the rest of the Arpanet.
CERN, the European internet, the link to the Pacific and beyond
In 1984 the move in Europe towards more widespread use of TCP/IP started, and CERNET was converted over to using it. The TCP/IP CERNET remained isolated from the rest of the Internet, forming a small internal internet until 1989.
In 1988 Daniel Karrenberg, from CWI in Amsterdam, visited Ben Segal, CERN's TCP/IP Coordinator; looking for advice about the transition of the European side of the UUCP Usenet network (much of which ran over X.25 links) over to TCP/IP. In 1987, Ben Segal had met with Len Bosack from the then still small company Cisco about TCP/IP routers, and was able to give Karrenberg advice and forward him on to Cisco for the appropriate hardware. This expanded the European portion of the Internet across the existing UUCP networks, and in 1989 CERN opened its first external TCP/IP connections.  This coincided with the creation of Réseaux IP Européens (RIPE), initially a group of IP network administrators who met regularly to carry out co-ordination work together. Later, in 1992, RIPE was formally registered as a cooperative in Amsterdam.
At the same time as the rise of internetworking in Europe, adhoc networking to ARPA and in-between Australian colleges formed, based on various technologies such as X.25 and UUCPNet. These were limited in their connection to the global networks, due to the cost of making individual international UUCP dial-up or X.25 connections. In 1989, Australian colleges joined the push towards using IP protocols to unify their networking infrastructures. AARNet was formed in 1989 by the Australian Vice-Chancellors' Committee and provided a dedicated IP based network for Australia.
The Internet began to penetrate Asia in the late 1980s. Japan, which had built the UUCP-based network JUNET in 1984, connected to NSFNet in 1989. It hosted the annual meeting of the Internet Society, INET'92, in Kobe. Singapore developed TECHNET in 1990, and Thailand gained a global Internet connection between Chulalongkorn University and UUNET in 1992.
A digital divide
While developed countries with technological infrastructures were joining the Internet, developing countries began to experience a digital divide separating them from the Internet. At the beginning of the 1990s, African countries relied upon X.25 IPSS and 2400 baud modem UUCP links for international and internetwork computer communications. In 1996 a USAID funded project, the Leland initative, started work on developing full Internet connectivity for the continent. Guinea, Mozambique, Madagascar and Rwanda gained satellite earth stations in 1997, followed by Côte d'Ivoire and Benin in 1998.
In 1991 China saw its first TCP/IP college network, Tsinghua University's TUNET. China went on to make its first global Internet connection in 1994, between the Beijing Electro-Spectrometer Collaboration and Stanford University's Linear Accelerator Center. However, China went on to implement its own digital divide by implementing a country-wide content filter.
Opening the network to commerce
The interest in commercial use of the Internet became a hotly debated topic. Although commercial use was forbidden, the exact definition of commercial use could be unclear and subjective. Everyone agreed that one company sending an invoice to another company was clearly commercial use, but anything less was up for debate. UUCPNet and the X.25 IPSS had no such restrictions, which would eventually see the official barring of UUCPNet use of ARPANET and NSFNet connections. Some UUCP links still remained connecting to these networks however, as administrators cast a blind eye to their operation.
During the late 1980s the first Internet service provider (ISP) companies were formed. Companies like PSINet, UUNET, Netcom, and Portal were formed to provide service to the regional research networks and provide alternate network access, UUCP-based email and Usenet News to the public. The first dial-up ISP, world.std.com, opened in 1989.
This caused controversy amongst university users, who were outraged at the idea of noneducational use of their networks. Eventually it was the commercial Internet service providers who brought prices low enough that junior colleges and other schools could afford to participate in the new arenas of education and research.
By 1990, ARPANET had been overtaken and replaced by newer networking technologies and the project came to a close. In 1994, the NSFNet, now renamed ANSNET (Advanced Networks and Services) and allowing non-profit corporations access, lost its standing as the backbone of the Internet. Both government institutions and competing commercial providers created their own backbones and interconnections. Regional network access points (NAPs) became the primary interconnections between the many networks and the final commercial restrictions ended.
Maintaining the infrastructure
The IETF and a standard for standards
The Internet has developed a significant subculture dedicated to the idea that the Internet is not owned or controlled by any one person, company, group, or organization. Nevertheless, some standardization and control is necessary for the system to function.
The liberal RFC publication procedure engendered confusion about the Internet standardization process, and led to more formalization of official accepted standards. The IETF started in January of 1986 as a quarterly meeting of U.S. government funded researchers. Representatives from non-government vendors were invited starting with the fourth IETF meeting in October of that year.
Acceptance of an RFC by the RFC Editor for publication does not automatically make the RFC into a standard. It may be recognized as such by the IETF only after experimentation, use, and acceptance have proved it to be worthy of that designation. Official standards are numbered with a prefix "STD" and a number, similar to the RFC naming style. However, even after becoming a standard, most are still commonly referred to by their RFC number.
In 1992, the Internet Society, a professional membership society, was formed and the IETF was transferred to operation under it as an independent international standards body.
NIC, InterNIC IANA and ICANN
The first central authority to coordinate the operation of the network was the Network Information Centre (NIC) at Stanford Research Institute (SRI) in Menlo Park, California. In 1972, management of these issues was given to the newly created Internet Assigned Numbers Authority (IANA). In addition to his role as the RFC Editor, Jon Postel worked as the manager of IANA until his death in 1998.
As the early ARPANET grew, hosts were referred to by names, and a HOSTS.TXT file would be distributed from SRI International to each host on the network. As the network grew, this became cumbersome. A technical solution came in the form of the Domain Name System, created by Paul Mockapetris. The Defense Data Network - Network Information Center (DDN-NIC) at SRI handled all registration services, including the top-level domains (TLDs) of .mil, .gov, .edu, .org, .net, .com and .us, root nameserver administration and Internet number assignments under a United States Department of Defense contract.  In 1991, the Defense Information Systems Agency (DISA) awarded the administration and maintenance of DDN-NIC (managed by SRI up until this point) to Government Systems, Inc., who subcontracted it to the small private-sector Network Solutions, Inc.
Since at this point in history most of the growth on the Internet was coming from non-military sources, it was decided that the Department of Defense would no longer fund registration services outside of the .mil TLD. In 1993 the U.S. National Science Foundation, after a competitive bidding process in 1992, created the InterNIC to manage the allocations of addresses and management of the address databases, and awarded the contract to three organizations. Registration Services would be provided by Network Solutions; Directory and Database Services would be provided by AT&T; and Information Services would be provided by General Atomics. 
In 1998 both IANA and InterNIC were reorganized under the control of ICANN, a California non-profit corporation contracted by the US Department of Commerce to manage a number of Internet-related tasks. The role of operating the DNS system was privatized and opened up to competition, while the central management of name allocations would be awarded on a contract tender basis.
Use and culture
Email and Usenet—The growth of the text forum
E-mail is often called the killer application of the Internet. However, it actually predates the Internet and was a crucial tool in creating it. E-mail started in 1965 as a way for multiple users of a time-sharing mainframe computer to communicate. Although the history is unclear, among the first systems to have such a facility were SDC's Q32 and MIT's CTSS. 
The ARPANET computer network made a large contribution to the evolution of e-mail. There is one report  indicating experimental inter-system e-mail transfers on it shortly after ARPANET's creation. In 1971 Ray Tomlinson created what was to become the standard Internet e-mail address format, using the @ sign to separate user names from host names. 
A number of protocols were developed to deliver e-mail among groups of time-sharing computers over alternative transmission systems, such as UUCP and IBM's VNET e-mail system. E-mail could be passed this way between a number of networks, including ARPANET, BITNET and NSFNet, as well as to hosts connected directly to other sites via UUCP.
In addition, UUCP allowed the publication of text files that could be read by many others. The News software developed by Steve Daniel and Tom Truscott in 1979 was used to distribute news and bulletin board-like messages. This quickly grew into discussion groups, known as newsgroups, on a wide range of topics. On ARPANET and NSFNet similar discussion groups would form via mailing lists, discussing both technical issues and more culturally focused topics (such as science fiction, discussed on the sflovers mailing list).
A world library—From gopher to the WWW
The first World Wide Web server, currently in the CERN museum, labeled "This machine is a server. DO NOT POWER DOWN!!"As the Internet grew through the 1980s and early 1990s, many people realized the increasing need to be able to find and organize files and information. Projects such as Gopher, WAIS, and the FTP Archive list attempted to create ways to organize distributed data. Unfortunately, these projects fell short in being able to accommodate all the existing data types and in being able to grow without bottlenecks.
One of the most promising user interface paradigms during this period was hypertext. The technology had been inspired by Vannevar Bush's "memex" and developed through Ted Nelson's research on Project Xanadu and Douglas Engelbart's research on NLS.  Many small self-contained hypertext systems had been created before, such as Apple Computer's HyperCard.
In 1991, Tim Berners-Lee was the first to develop a network-based implementation of the hypertext concept. This was after Berners-Lee had repeatedly proposed his idea to the hypertext and Internet communities at various conferences to no avail - no one would implement it for him. Working at CERN, Berners-Lee wanted a way to share information about their research. By releasing his implementation to public use, he ensured the technology would become widespread.  Subsequently, Gopher became the first commonly-used hypertext interface to the Internet. While Gopher menu items were examples of hypertext, they were not commonly perceived in that way.
Mosaic, a graphical browser for the WWW, was developed by a team at the National Center for Supercomputing Applications at the University of Illinois at Urbana-Champaign (NCSA-UIUC), led by Marc Andreessen. Funding for Mosaic came from the High-Performance Computing and Communications Initiative, a funding program initiated by then-Senator Al Gore's High Performance Computing Act of 1991. Mosaic's graphical interface soon became more popular than Gopher, which at the time was primarily text-based, and the WWW became the preferred interface for accessing the Internet. The World Wide Web has led to a widespread culture of individual self publishing and co-operative publishing. The moment to moment recounts of a Blog, and the information store of Wikipedia are both a result of the open ease of creating a public website.
Finding what you need—The search engine
Even before the World Wide Web, there were search engines that attempted to organize the Internet. The first of these was the Archie search engine from McGill University in 1990, followed in 1991 by WAIS and Gopher. All three of those systems predated the invention of the World Wide Web but all continued to index the Web and the rest of the Internet for several years after the Web appeared. There are still Gopher servers as of 2006, although there are a great many more web servers.
As the Web grew, search engines and Web directories were created to track pages on the Web and allow people to find things. The first full-text Web search engine was WebCrawler in 1990. Before WebCrawler, only Web page titles were searched. Another early search engine, Lycos, was created in 1993 as a university project, and was the first to be commercially successful. By August 2001, Google tracked over 1.3 billion web pages and the growth continues, although the real advances are not in terms of database size, but relevancy ranking, the methods by which search engines attempt to sort the best results first. Algorithms for this have continuously improved since circa 1996, when it became a major issue, due to the rapid growth of the web, which made it impractical for searchers to look through the entire list of results. As of 2006 the rankings are more important than ever, since looking through the entire list of results is not so much impractical as humanly impossible, since for popular topics new pages appear on the web faster than anyone could read them all. Google's PageRank method for ordering the results has received the most press, but all major search engines continually refine their ranking methodologies with a view toward improving the ordering of results.
The dot-com bubble
The suddenly low price of reaching millions worldwide, and the possibility of selling to or hearing from those people at the same moment when they were reached, promised to overturn established business dogma in advertising, mail-order sales, customer relationship management, and many more areas. The web was a new killer app -- it could bring together unrelated buyers and sellers in seamless and low-cost ways. Visionaries around the world developed new business models, and ran to their nearest venture capitalist. Of course a proportion of the new entrepreneurs were truly talented at business administration, sales, and growth; but the majority were just people with ideas, and didn't manage the capital influx prudently. Additionally, many dot-com business plans were predecated on the assumption that by using the Internet, they would bypass the distribution channels of existing businesses and therefore not have to compete with them; when the established businesses with strong existing brands developed their own Internet presence, these hopes were shattered, and the newcomers were left attempting to break into markets dominated by larger, more established businesses. Many did not have the ability to do so.
The dot-com bubble burst on March 10, 2000, when the technology heavy NASDAQ Composite index peaked at 5048.62 (intra-day peak 5132.52), more than double its value just a year before. By 2001, the bubble's deflation was running full speed. A majority of the dot-coms had ceased trading, after having burnt through their venture capital, often without ever making a gross profit.
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Attribution: Some information for this article has been adapted from wikipedia under Creative Commons Attribution-ShareAlike License.