Re: Equality and asymetry in network designs

[David Diaz/I.P.O.F.-Netrail, Inc.]

---------
And the biggest question of all.  The USA is still the largest net exporter
of data bits in the world.  How much should US providers be paying non-USA
providers to accept the bits?  Right now, other than some NSF-funded
connectivity such as Sprint ICM, most non-USA commercial networks must
pay the full cost of the inter-continental circuits.  Should the Internet
adopt a charging model like international voice settlements.
---------

John,
I have been discussing the model mentioned about with some forgein PTTs
that are in the internet buiz.  I think it is fair especially since I
believe for the moment that capital would be flowing in my direction for
the moment.  I thought it was fair and there were several ways to try and
work the deal.  Perhaps having a large carrier be a transit AS for me in
say Japan wouldnt be such a bad way to expand.  This was all just rough
talk but I was interested.  Obviously expanding backbones to go
international quickly has it's pluses.  I think partnerships are the way to
go unless you are monopolistic and that is only beneficial short term.

Dave




At 3:14 AM -0000 8/25/98, Sean Donelan wrote:
>jcurran@bbnplanet.COM (John Curran) writes:
>>p.s.  The fact that the sender of traffic should be paying some portion
>>      of the resulting costs is not a surprise to anyone; many of the
>>      content companies that I've spoken to believe they already are
>>      paying more as traffic increases, and were quite surprised to
>>      find that it doesn't actually make it to the networks which
>>      bear the brunt of the traffic carriage.
>
>As someone who pays to carry traffic to both coasts, and pays to carry
>traffic from both coasts to the center of the country and other places
>where I notice very few large providers seem to exchange traffic I am
>perpetually amused by this recurring discussion.
>
>If I read Mr. Curran's statement at face value I would assume networks
>such as DRANET which are net importers of data, and pick up the data on
>both coasts networks would expect to start receiving payments from large
>providers with large web hosting centers in cities such as Cambridge.
>
>I look at maps such as http://www.bbnplanet.com/products/maps/us_host.htm
>and see a network which is strong in some areas, and very weak in other
>areas.  St. Louis seems to be a gaping hole in many large providers.  Sure,
>the sales people always say "don't worry, any day we'll have capacity there
>soon" but if you want something today we have to pay our way to an outer edge
>of the country.  Even if the network shows a "dot" in the middle of the
>country, when you investigate further, I've usually found limited facilities.
>
>I'm sorry if I sound cynical.  But I've been down this road of ever
>changing requirements too many times.  "Best-Exit" used to be the norm,
>I even have a mail message from a Sprint engineer prohibiting "Hot potato"
>routing if I wanted to peer with Sprint.  Then the requirements changed,
>I modified our network to comply, and the other provider of interest comes
>up with a different requirement to justify it isn't a "peer" because something
>is "unequal."  The fact is, no two networks are equal in every way.
>
>How do you compare networks with large consumer access, web hosting, or
>large numbers of dedicated access customers?  How do you compare a network
>with a large backbone in the continental USA with a network with a smaller
>backbone in the USA plus Canada?  Or how to you compare a network with
>lots of transatlantic connectivity, but little cross-USA backbone or
>trans-pacific connectivity.
>
>And the biggest question of all.  The USA is still the largest net exporter
>of data bits in the world.  How much should US providers be paying non-USA
>providers to accept the bits?  Right now, other than some NSF-funded
>connectivity such as Sprint ICM, most non-USA commercial networks must
>pay the full cost of the inter-continental circuits.  Should the Internet
>adopt a charging model like international voice settlements. Will we see
>the rise of 'call-back' services on the Internet based on asymmetric charges
>for inbound and outbound data flows?  The simple way to avoid people
>'working' the system is to keep charges as close as possible to the actual
>costs, so there is no incentive.  But shareholders prefer companies that
>operate well above the marginal cost, so you see companies trying to
>create a pricing model which allows them to charge above cost.
>
>I like profit too, but other than certain regulated monopolies and software
>companies, in a competitive market with low barriers to entry profit
>margins are going to be narrow.  One way to increase the 'spread' is to
>to raise your competitors costs and make it difficult for new providers
>to enter the market.  Internal network design requirements of the other
>providers network seem to be the most popular, e.g. you must put pipes
>of certain sizes into certain locations even if it doesn't make design
>sense.
>
>I've noticed that most of the newest competitors trying to enter the
>market in the last year have resorted to buying a provider with an
>existing peering agreement because it was virtually impossible for the
>new competitor to get peering with some large providers, Level 3->Geonet,
>Qwest->Eunet, and then pumping up the size of the pipes through those
>existing interconnect.
>
>I've long said I'll agree to any settlement scheme, so long as it is
>reciprocal.  The problem I've seen with most of the schemes going back
>to the ANS CO+RE charges has been the one-way nature of the settlements.
>--
>Sean Donelan, Data Research Associates, Inc, St. Louis, MO
>  Affiliation given for identification not representation


Thank you,
David Diaz
Chief Technical Officer
Netrail, Inc

email:   davediaz@netrail.net
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