Re: NANOG67 - Tipping point of community and sponsor bashing?

[Nurani Nimpuno <nurani () netnod se>]

Hi Dave,

So, I watched your presentation this week at NANOG remotely, sorry I couldn’t be there.

Ok, so while you make a lot of very different points in your presentations, I *think* the basic argument you are making 
is that IXPs are too expensive. Correct me if I’m wrong. Or more specifically, you are saying that Ams-IX, Linx, Netnod 
and DE-CIX are too expensive. You have not looked at US IXPs because they don’t publish their fees, and you have not 
looked at the whole IXP community. 

I think you are then also questioning if these IXPs are using their funds wisely. You are also stating that you are 
talking about these IXPs from the perspective of a big US provider connecting into Europe (i.e not a small local ISP). 
You question some of the IXP expansions into the US. You question the membership model as a viable model for IXPs. You 
also say that those who sustain the IXPs growth should benefit from them. And you question why there are so many IXPs, 
and not only a handful of very big ones. I hope I have captured this correctly. 

Ok, so firstly, I must say I’m a little disappointed that you or your staff have never approach us to discuss any of 
this. We have Netnod meetings twice a year, we have been present at many of the same events in the last year and we 
have always strived to be open, transparent and to listen to our entire customer base. I take your point about the 
Netnod fees (even though I would also like to point out that we have actually reduced our other port fees for 100mbps, 
1G, remote peering). But I’m not sure why you haven’t brought it to us directly. Netflix has been at several Netnod 
meetings in the past, so we have had plenty of opportunity to discuss this. 

But ok, let’s leave that aside. I will try to address some of your points.

Firstly as many have pointed out, these four IXPs are not representative of all IXPs, and the four of us are also very 
different from each other. 

I can’t address the IXP expansion into the US. And I don’t represent a membership-based IXP. 

The European IXP community is a very diverse one, serving different regions, markets and different types of customers. 
I personally believe that this rich diversity is one of the reasons the European interconnection scene has been 
flourishing as well as it has. There is a big difference between Europe and the rest of the world, particularly the US. 
And the European IXP community was held up as a model for the rest of the world by many. We have been cooperating for 
many years through the Euro-IX where our common goals have been to improve interconnection in the region, share 
information and experience and work to improve services for our customers. (I believe you have been trying to do the 
same through Open-IX.)

The diversity has also been seen as important to serve both the very large international providers like yourself, and 
the small local ISPs. Localising traffic and building a local operator community have been seen as an important 
ingredient in the value of the IXPs. Our challenge as IXPs is to find the best way to serve all these different needs 
and wishes from our very diverse customer base. Having only a handful of very large IXPs would in my view not serve 
these different needs as well. Personally I am a subscriber to both Netflix and HBO. I like diversity. :) But sure, 
it’s an interesting discussion to be had!

As others have pointed out, contrary to common belief, the technical part of an IXP is one of the simplest. There is a 
plethora of examples of IXPs in Africa, but also in the US, where IXPs simply are a single switch sitting in a closet 
somewhere, only serving a handful of ASes. One of the biggest challenges for an IXP is to gain customers and get enough 
gravitation and value to the exchange. A growing exchange point is not only a "nice-to-have" for those operating it, 
but vital to those networks who peer there. If you stop adding value to those networks peering at the IX, you will 
slowly become irrelevant. 

While some think that a good technical solution would sell itself, I believe that is a fallacy (not only in the IXP 
world). Netnod started out as a very small IXPs with only a few local operators connected to it. And I strongly believe 
that if we hadn’t done as much outreach as we do, we would’ve stayed tiny until this day. 

As for how we do this outreach and what events we go to, while I can’t speak for any other IXes, I seriously doubt that 
any professional IXP today would not carefully assess the business value for each event it attends. At Netnod, we 
evaluate each event we send people to, and assess and measure the value afterwards. 

Then I thought I would write some words about Netnod specifically since you bring us up. 

(As others have pointed out, the RIPE meeting social is covered partly by the RIPE NCC, partly by the sponsor, and 
partly by the participants themselves, so I’ll just leave that there.) 

Firstly, yes we are a little strange. We are not just an IXP. We run i-root.servers.net and we provide DNS anycast 
service, among other things. We also have a funny governance structure for historical reasons (which was set up when 
Netnod was established and the IXP and I-root “moved” there) many years ago. We are owned by a foundation and we 
describe ourselves as non-profit. In Sweden there is actually no “non-profit” status as such, but we have always 
operated under that principle. We are not a membership organisation, but we have always strived to be transparent, and 
whenever we have wanted to make major changes to our services, we have consulted the customer base. That is how we have 
worked on both the IX and DNS side. 

We work in a similar way with our pricing. (You mention that there is a lot of negotiations on pricing with IXPs.) I 
would like to be 100% clear that for the Netnod IX, we don’t negotiate or give “sweet deals” to anyone. We publish our 
fee schedule and we stick to it. Whenever someone wants a special deal (which happens often, particularly with the 
larger customers), our response is that we treat everyone equally. If you want a cheaper deal, then another customer is 
basically funding your reduction. So we don’t do this. We believe this is more fair and transparent. 

Coming back to Netnod's broader scope, this also means that we do other things than sell peering. We go to, and sponsor 
events that might not make sense from a peering perspective. We support other “Good of the Internet” initiatives, we 
participate in standards development (particularly on the DNS side), we participate in TLD associations etc. Some of 
these activities may seem odd to some who are only involved with one part of our business, I understand that. We try to 
be open with this though. 

As for a general discussion about costs, service levels and IXPs, I think there is a very interesting discussion that 
could be had with a more focused discussion. How do “we” best serve today's very diverse set of operators? How does an 
IXP strike that balance? How do operators best solve their interconnection needs (through IXPs, private peering, 
transit etc) and is that changing? What type of interconnection environment do we believe best scales Internet growth 
in the future? What is the total cost of interconnection, where are the big costs, what are the different models and 
where is the whole industry moving? Now THOSE are discussions I personally would find very valuable! 

Cheers,

Nurani
Netnod 




> On 15 juni 2016, at 13:21, Dave Temkin <dave () temk in> wrote:
>
> On Wed, Jun 15, 2016 at 3:43 AM, Aled Morris <aledm () qix co uk> wrote:
>
> > Me too and I was confused about what the point of it was.
> >
> > I had always assumed the customers of those IXs he singled out were
> > generally happy with the service they were getting and the money they are
> > paying.
> >
> > Is Dave trying to say they are being duped?  Is he trying to identify a
> > need for regulation?
>
> I was pointing out facts about IXPs that many did not know, including the
> actual organizational structure.
>
> I was also opining on how these IXPs could be better; mainly, how they
> choose to spend money.
>
>
>
> > Perhaps Dave was advocating the SIX model and suggesting the customers of
> > the existing exchanges should be looking to organise an alternative in
> > their localities.
>
> Absolutely correct (which should answer Hank's question, as well).
>
>
> > Or perhaps this is a wakeup call for LoNAP and the smaller exchanges who
> > "compete" with AMS-IX, DE-CIX and NetNod - stop trying to mimic their
> > commercial models (big fees which pay for staff and marketing) and look
> > instead at the lean SIX as the way of offering a service at a price
> > competitive to transit.
>
> Also absolutely correct. I don't want to see them falling into a trap of
> conflating marketing and outreach and/or offering an overly rich product
> set at the cost of price and operational simplicity.
>
>
> > Or was there a hidden message in Dave's presentation that I missed?
>
> Seems like you got it.
>
>
> > Aled