nanog mailing list archives
Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here...
From: Matthew Petach <mpetach () netflight com>
Date: Wed, 14 May 2014 01:11:30 -0700
On Sat, May 10, 2014 at 8:04 AM, Rick Astley <jnanog () gmail com> wrote:
[...] The reality is an increasingly directly peered Internet doesn't sit well if you are in the business of being the middle man. Now if you will, why do transit companies themselves charge content companies to deliver bits? How is it fair to be in the business of charging companies to receive their bits and hand them to a settlement free peer on the hook to deliver them, but not fair for content to just bypass the transit company and enter a paid peering agreement with the company delivering the bits? In this case paid peering is mutually beneficial to both companies involved and is typically cheaper for the content company than it would cost to send that traffic over transit.
What you're missing is that the transit provider is selling full routes. The access network is selling paid peering, which is a tiny fraction of the routes. If I pay transit provider X $10/mb (i know, not realistic, but it makes my math work) to reach the entire internet, it might seem reasonable to pay access network C $5/mb to hand traffic to them, and bypass the transit provider, avoiding potentially congested links. But then access network A decides they want to cut out the middleman as well--so they do the same thing, run their ports to transit provider X hot; to avoid that, I can pay the cheap price of $4/mb to reach them. Now access networks F and D want to do the same thing; their prices for their routes are $4 and $5/mb, respectively. Finally, little access provider T wants in at $2/mb for their routes. So, at the end of the week, I *had* been paying $10/mb to send traffic through transit to reach the whole rest of the internet. Now, I'm paying $5+$4+$4+$5+$2, or $30, and I don't have a full set of routes, so I've still got to keep paying the transit provider as well at $10. Depending on port counts, locations, and commit volumes, your "typically cheaper for the content company than it would cost to send that traffic over transit" has flown completely out the window. It could even end up being many times more expensive to handle the traffic that way. In order for the costs to work out, you'd really need to apply a formula along the lines of C(n) <= T(n) * C(t) where T(n) =fraction of traffic volume destined for access network X C(t)=cost of transit (ie, full routes, reachability to the entire internet) C(n)=cost of paid peering to access network X So, if you're an access network and want to charge for paid peering, and you represent 1/20th of my traffic, there's no reason for me to pay more than 1/20th of my transit cost for your routes; otherwise, it's more cost effective for me as a business to continue to pay a transit provider. I'm constantly amazed at how access networks think they can charge 2/3 the price of full transit for just their routes when they represent less than 1/10th of the overall traffic volume. The math just doesn't work out. It's nothing about being tier 1, or bigger than someone else; it's just math, pure and simple. Matt (currently not being paid by anyone for my time or thoughts, so take what I'm saying as purely my own thoughts on the matter, nothing more)
Current thread:
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality, (continued)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality arvindersingh (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality Blake Dunlap (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality Scott Helms (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality Jerry Dent (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Joe Greco (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality arvindersingh (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality David Conrad (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality Owen DeLong (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Paul WALL (May 10)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Jean-Francois Mezei (May 10)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Matthew Petach (May 14)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Roland Dobbins (May 14)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Mark Tinka (May 14)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Owen DeLong (May 14)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Matthew Petach (May 14)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Mark Tinka (May 14)
- Message not available
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality Larry Sheldon (May 14)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality Matt Palmer (May 14)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality Owen DeLong (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality Matt Palmer (May 15)
- Re: Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here... Hugo Slabbert (May 14)