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Re: AOL & Cogent

  • From: Leo Bicknell
  • Date: Sat Dec 28 16:45:17 2002
  • Reply-by: Sat Jan 4 16:28:00 EST 2003

Well, it only took the press 9 days to get a story out, I guess
that isn't all bad.  The Washington Post now has a story on this
issue:

http://www.washingtonpost.com/wp-dyn/articles/A45819-2002Dec27.html

It claims AOL wants $75000/month.  If we use the $50/meg Andrew
Partan posted that would be an even 1.5 Gig, which is an entirely
plausible number for the traffic level (given previous rumor of
2xOC-12, eg 1.2 Gig, recently upgraded to 2xOC-48).

I'll offer two comments from my own opinion:

- Peering should cost significantly less than transit.  At least
  half, probably less.  If you have 1.5 Gig, getting $50 a meg
  transit is trivial today.  I can't imagine any company paying
  $50 a meg for peering, no matter what the circumstances.  Perhaps
  that was the point though.

- In my opinion, if you want to enforce a ratio and charge people
  who do not meet it, the charge should only be on the difference.
  That is, say it was 1500 Mbps Cogent->AOL, and 500Mbps AOL->Cogent.
  The first 1000 Mbps (2x500, 2:1 ratio), Cogent->AOL should be
  free, as they would be if there was less traffic.  Charging for
  the extra 500, while not something I advocate, would be fair.
  To make it such that 1000Mbps would be "free", but 1001 Mbps
  means to pay for the first 1000 is just stupid.  People don't
  generally accept pricing models that have large jumps in them,
  they want something progressive.

I wonder what Cogent's response would have been if the charge was
only for the amount over 2:1, and was a reasonable price for peering,
perhaps $15/Meg and AOL gets to pick the locations....

-- 
       Leo Bicknell - bicknell@ufp.org - CCIE 3440
        PGP keys at http://www.ufp.org/~bicknell/
Read TMBG List - tmbg-list-request@tmbg.org, www.tmbg.org

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