Curious thing, the CEO of my company called me the other day and was worried about who we were peering with. It seems someone put a bug in his ear that the larger providers were about to start charging some of the smaller providers for bilateral peering. I haven't heard anything about that at all... so either a) the ceo is mistaken b) I've missed some important annoucement recently either is possible. Has anyone else heard anything about this? Thanks, davec
On Sun, 26 Jan 1997, Dave Curado wrote:
I haven't heard anything about that at all... so either a) the ceo is mistaken b) I've missed some important annoucement recently either is possible. Has anyone else heard anything about this?
This has been mentioned/suggested multiple times in the past on the NANOG list and also in passing in talks at the last NANOG meeting in Ann Arbor. There is atleast one major player (I forget who, we didn't care to pay) that does offer a peering only service for those networks that haven't managed to negotiate peering with them. Peering is frequently an exercise in posturing and politics by the wooed peers (especially the larger ones). People from the larger networks frequently say things in public (for example at NANOG) that are the way they wish things were as opposed to how they are. Since your traffic gets to any non peer via transit it simply becomes a question of money and capacity planning whether you care to pay for any specific peering session. Extra commentary follows... I believe the strategic marketing reason to peer with a competing network is that it increases the value of your network relative to the rest of the marketplace (the networks other than this specific peer) more than the opportunity cost of increasing the value of this specific peer's network. If you view your network as a majority market share holder you don't have much reason to peer from a strategic marketing point of view. Of course another reason you peer with other networks is if you believe your mission is to provide the best connectivity and least number of hops possible vs. customer dollars spent, but this depends on what you think your customers want. Mike. +------------------- H U R R I C A N E - E L E C T R I C -------------------+ | Mike Leber Direct Internet Connections Voice 408 282 1540 | | Hurricane Electric Web Hosting & Co-location Fax 408 971 3340 | | mleber@he.net http://www.he.net | +---------------------------------------------------------------------------+
I don't think anyone has actually started charging "settlements" which is what your CEO is probably talking about. It's been a rumor for quite a while that settlement based peering will happen. Very similar to how the utilities companies manage "traffic". You would count bits into your network from peer X and he would count bits from your network, whoever has the lowest number has to pay the difference. So, if you are a small provider, your going to have to pay the big boys to carry your customers traffic. Welcome to the new Internet, where the bottom line is the driving factor. Especially since the margins are so low and no-one has made any money yet (will we ever?). Since some of the larger vendors (Cisco mostly) has introduced accounting features into their software settlements could start any time. It's just a matter of time until someone actually announces it.. who will jump first? I have my guess but I don't think I want to announce it publicly. :) Eric _______________________________________________________ Eric D. Madison - Senior Network Engineer - ACSI - Advanced Data Services - ATM/IP Backbone Group 24 Hour NMC/NOC (800)291-7889 Email: noc@acsi.net On Sun, 26 Jan 1997, Dave Curado wrote:
Curious thing, the CEO of my company called me the other day and was worried about who we were peering with. It seems someone put a bug in his ear that the larger providers were about to start charging some of the smaller providers for bilateral peering.
I haven't heard anything about that at all... so either a) the ceo is mistaken b) I've missed some important annoucement recently
either is possible.
Has anyone else heard anything about this?
Thanks, davec
At 2:04 AM -0500 1/26/97, Eric D. Madison wrote:
I don't think anyone has actually started charging "settlements" which is what your CEO is probably talking about. It's been a rumor for quite a while that settlement based peering will happen. Very similar to how the utilities companies manage "traffic". You would count bits into your network from peer X and he would count bits from your network, whoever has the lowest number has to pay the difference. So, if you are a small provider, your going to have to pay the big boys to carry your customers traffic. Welcome to the new Internet, where the bottom line is the driving factor. Especially since the margins are so low and no-one has made any money yet (will we ever?).
A good reference on financial issues in peering models is http://iepg.org/settlements.html, a paper by Geoff Huston.
Since some of the larger vendors (Cisco mostly) has introduced accounting features into their software settlements could start any time. It's just a matter of time until someone actually announces it.. who will jump first? I have my guess but I don't think I want to announce it publicly. :)
Eric
On Sun, 26 Jan 1997, Dave Curado wrote:
Curious thing, the CEO of my company called me the other day and was worried about who we were peering with. It seems someone put a bug in his ear that the larger providers were about to start charging some of the smaller providers for bilateral peering.
I haven't heard anything about that at all... so either a) the ceo is mistaken b) I've missed some important annoucement recently
either is possible.
Has anyone else heard anything about this?
participants (4)
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Dave Curado -
Eric D. Madison -
Howard C. Berkowitz -
Mike Leber