On Jun 20, 2013, at 5:47 PM, Robert M. Enger <na...@enger.us> wrote:
> Perhaps last-mile operators should
> A) advertise each of their metropolitan regional systems as a separate AS
> B) establish an interconnection point in each region where they will accept
> traffic destined for their in-region customers without charging any fee
C) Buck up and carry the traffic their customers are paying them to carry.
Least I just sound like a complainer, I actually think this makes rational
business sense.
The concept of peering was always "equal benefit", not "equal cost". No one
ever compares the price of building last mile transport to the cost of building
huge data centers all over with content close to the users. The whole
"bit-mile" thing represents an insignificant portion of the cost, long haul (in
large quantities) is dirt cheap compared to last mile or data center build
costs. If you think of a pure content play peering with a pure eyeball play
there is equal benefit, in fact symbiosis, neither could exist without the
other. The traffic flow will be highly asymmetric.
Eyeball networks also artificially cap their own ratios with their products.
Cable and DSL are both 3x-10x down, x up products. Their TOS policies prohibit
running servers. Any eyeball network with a asymmetric edge technology and
no-server TOS need only look in the mirror to see why their aggregate ratio is
hosed.
Lastly, simple economics. Let's theorize about a large eyeball network with
say 20M subscribers, and a large content network with say 100G of peering
traffic to go to those subscribers.
* Choice A would be to squeeze the peer for bad ratio in the hope of getting
them to pay for, or be behind some other transit customer. Let's be generous
and say $3/meg/month, so the 100G of traffic might generate $300,000/month of
revenue. Let's even say you can squeeze 5 CDN's for that amount, $1.5M/month
total.
* Choice B would be to squeeze the subscribers for more revenue to carry the
100G of "imbalanced traffic". Perhaps an extra $0.10/sub/month. That would be
$2M/month in extra revenue.
Now, consider the customer satisfaction issue? Would your broadband customers
pay an extra $0.10 per month if Netflix and Amazon streaming never went out in
the middle of a movie? Would they move up to a higher tier of service?
A smart end user ISP would find a way to get uncongested paths to the content
their users want, and make it rock solid reliable. The good service will more
than support not only cost recovery, but higher revenue levels than squeezing
peers. Of course we have evidence that most end user ISP's are not smart, they
squeeze peers and have some of the lowest customer satisfaction rankings of not
just ISP's, but all service providers! They want to claim consumers don't want
Gigabit fiber, but then congest peers so badly there's no reason for a consumer
to pay for more than the slowest speed.
Squeezing peers is a prime case of cutting off your nose to spite your face.
--
Leo Bicknell - bickn...@ufp.org - CCIE 3440
PGP keys at http://www.ufp.org/~bicknell/
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