You omitted the fact that the 1500 byte packets carry a bunch of paid advertising, and thus are already revenue-producing. On 20 Apr 00, at 1:42, I Am Not An Isp wrote:
Simplistic example: Network A hosts big web sites. Network B has a gazillion dial-up users. The two networks peer at MAE-East and MAE-West. The web sites are in San Jose, the dial-up users are in DC.
Typical TCP flow looks like this: 1500 byte packet goes from web server to MAE-West on Network A, then transfers to Network B (because of "hot potato" routing) and comes across the country to DC destined for dialup user. Then a 64 byte ACK goes from DC to MAE-East on Network B, then transfers to Network A where it rides to San Jose.
In Other Words: Network B is carrying 1500 byte packets 3000 miles, and Network A is carrying 64 byte packets 3000 miles.
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In summary, there is nothing wrong with settlements to help off-set unequal network costs. It is a perfectly valid business practice. Nor, IMHO, does it make one network a "customer" of the other. The two networks are just trying to share everything equally, including network costs.