Re: peering charges?

[Vadim Antonov <avg () pluris com>]

Dirk Harms-Merbitz <dirk () power net> wrote:

> > What is the value of a packet?  It is not even clear if packet crossing
> > from your network to my network gives _me_ any value.  It can as well
> > be for _your_ benefit.

> Nah, you originated the packet for reasons unknown to me.

Yeah?  Even when that packet is the direct result of your earlier DNS request?

> In a capitalist economy, price generally follows value.

> Scarcity creates value, hence the desire to differentiate.

Economics 101 again.  Scarcity does not create anything.  It's merely
a range on demand-supply curve.

> Once I'm connected, however, transitting traffic through your network is
> the only thing that I'm interested in. Why else would I want to connect to
> your network?

You only interested in transmission at the point where you know _where_
to transmit.  Before that you have _no_ idea you may need some specific
destination.  You don't know all URLs you will ever use beforehand.

Thus, universal accessibility has permanent value.


> That's because he has (implied) obligation to provide adequate
> service during peak usage.

> An simplified example. Lets say I have a direct T1 between A and B. A
> starts to transfer 4 GBytes from B to A and uses 100% of the bandwidth.
> Then B starts another transfer of 4GBytes from A to B. Both now use 50% of
> the bandwidth and each transfer takes twice as long.

It is a gross oversimplification.  Things do not work like that.

> I can still telnet between the two locations, even play quake - the load
> is hardly noticable for short transfers.

Actually, quite opposite. The handshake has nothing like quick start,
only exponential back-off; so it is more vulnerable than data transmission
stage of the connection.

> Connection costs are generally figured into non-recurring charges.
> They usually do not exceed costs of equipment and overhead.

> That was my point. Why charge a higher _recurring_ fee for a faster
> connection?

Because the share of higher-level facilities needed to accomodate
projected usage is more.

> This is an example of patently meaningless analogy.  _Every_ business
> (even pyramid scams) has some capital costs.  So what.

> Why meaningless? There's no way to get the money back out once the cable
> is in the ground or the chip is being fabricated.

And so there is no way to recover all money spent on building a rental complex
or sent out to first level of the pyramid.

It's the nature of investment, ok?

> You will be surprised.  Sprint has 6 (six) strands of fiber in its

> How do you know?

I used to work there.

--vadim
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