Yes they are -- content providers aren't getting their connections to the Internet for free (and if they are, how can I get me some of that?).
Maybe I wasn't clear. Traffic is moving away from "transit" to direct peering at private exchanges in many cases. Since most exchanges are "flat rate" and aren't all that expensive, it is "practically" free. For example, if I have a 10G connection to an exchange (say Equinix IX, or DEIX in Germany, or LINX in the UK, or PARIX in France, or INIX in Ireland among other) it doesn't cost me any more to send 1G than it does to send 5G of traffic. So if something happens that increases the bandwidth utilization, my monthly cost does not change until I have to change to higher capacity media and that is a step change. =20
That only happens if both parties choose to peer. Even though the cost per incremental *bit* might appear to be zero, there's a large cost in terms of exchange membership, colocating equipment, etc.
If the ISPs are directly peering with the content provider at some IX, the content provider gets what amounts to a free ride to the end user. =20 Say wha? ISPs don't *have* to peer at an IX; if they think that it's cheaper to buy transit from someone than it is to peer, they're more than capable of doing so.
Transit would have to get extremely cheap to compete with exchange peering. I don't see it getting that low any time soon.
I thought I heard some folks were bailing on peering because transit was so cheap. Last time I looked, Equinix Exchange wasn't exactly cheap, it was quite a bit cheaper to run private cross-connects.
=20 The customer's requesting this traffic, therefore the customer needs a bigger pipe, therefore the customer pays more.
The problem is that maybe the customer is doing nothing different than they have always done. They didn't request more bandwidth. The product they have always used now consumes more bandwidth through no fault of their own. It would be as if you regularly ordered some product every month and the product keeps getting heavier and heavier and the shipping costs go up until the weight is higher than the carrier will ship. You are ordering the same thing you always did, you didn't ask for it to be heavier, the producer decided to make it heavier. But that is not a perfect analogy because a consumer pays a flat monthly "shipping fee" for Internet traffic. The problem comes in when the content providers make it "heavier" or higher bandwidth utilization beyond the control of the customer. Now the customer's pipe is saturated and they aren't doing anything different than what they did before. Or maybe some new product is released that is an out and out bandwidth hog.
Okay, so it's kind of like the evolution of the modern road. Years ago, we had cars that resembled horse buggies and dirt or gravel roads. As time passes, cars improve and roads improve. Now we have cars that are capable of 200MPH and the pavers on the Autobahn use lasers to make sure the road is sufficiently smooth that drivers don't wreck at those speeds. At the same time, we no longer have manual laborers doing most of the laying of the roads by hand, even the Germans figured out really quickly that machines were better at it. So on one hand, machinery drives the cost of laying road down, and on the other, increased automobile use and more roads drives the cost of maintaining our system of roads up. Mapped back to the world of NANOG, we need to be aware that the computer of today, the storage technology of today, the home entertainment systems of today, etc., are all much faster and more sophisticated than just what we had ten years ago. We've made it very difficult for users to continue to use older computers: the web browsers are hungrier and piggier, and a 233 MHz 32MB Win98 machine that was perfectly suitable in 1998 is only good for being sent to India for recycling today. It seems unlikely to me that we're going to slow the evolution of modern computing and modern media consumption. Perhaps we need to find a better way to connect people. I know that the legacy communications providers are very hesitant to start replacing their "gravel road" coax with faster stuff, but really, that's the point we're at. In the last decade, the thing that's been dragging us down is that last mile pipe. We already know that it is reasonably economical to arrange for faster access. One just has to look around elsewhere to see what's been done. Other countries are providing speeds of up to 100Mbps to residential. We're still hearing our telcos argue for definitions of "broadband" that are less than 1Mbps. Talk about dirt road lovers.
MOST people using consumer Internet have no idea of things like that nor should they need to. All they know is that now their Internet performs like crap and their ISP wants more money to make it work better. They might feel they have been ripped off. As time goes by, their Internet performs worse and worse, they begin to blame their network provider for that, not the content provider who produces a product that consumes increasing amounts of bandwidth as time goes by. Consider, for example, the number of sites that have streaming media of some sort that begins to play as soon as you land on the page. =20
"Kill HTML5! Kill HTML5!" ... Or maybe let's fix those roads. ... JG -- Joe Greco - sol.net Network Services - Milwaukee, WI - http://www.sol.net "We call it the 'one bite at the apple' rule. Give me one chance [and] then I won't contact you again." - Direct Marketing Ass'n position on e-mail spam(CNN) With 24 million small businesses in the US alone, that's way too many apples.