http://biz.yahoo.com/prnews/051028/laf022.html?.v=27
The internet will not end on November(9)th 
- jared
Now, one really needs to wonder why the agreement could not be reached
*prior* to the depeering on 10/5
It's not rocket science.
It's only as complex as one makes it out to be. (one can attempt to explain
away the complexities, but they apparently were able to *finalize* an
agreement in 3 weeks, perhaps the agreement happened in it's entirety in 3
weeks - no speculation on the agreement is required unless you have nothing
better to do)
Who are the next discontent couples?
"...the companies have agreed to the settlement-free exchange of traffic subject to specific payments if certain obligations are not met."
So it does look like Cogent bent somwhat...I'm guessing they agreed to pay some sort of "traffic imbalance fee"? Anyone know of any other peering arrangements that have similar terms? I'll admit, that's a new one for me...
-C
Christopher Woodfield wrote:
"...the companies have agreed to the settlement-free exchange of traffic subject to specific payments if certain obligations are not met."
So it does look like Cogent bent somwhat...I'm guessing they agreed to pay some sort of "traffic imbalance fee"?
There are other possibilities.
Maybe they agreed to pay a transit fee should they fail to carry the L3 user's requested traffic as far as possible before handing it off (cold potato routing) and hand it off at the earliest possibility (hot potato routing) leaving L3 to backhaul it across the L3 network to the user who requested the data.
Etc.
jc
Eric Louie wrote:
Now, one really needs to wonder why the agreement could not be reached
*prior* to the depeering on 10/5It's not rocket science.
As people have pointed out repeatedly, this was surely not rocket science
since it wasn't a technical problem at all. It was a business conflict.
It seems clear to me what probably happened. First-round negotaitions
failed 'cause Level 3 thought Cogent was bluffing (and perhaps vice
versa). Level 3 called the bluff, but it wasn't a bluff, and Level 3
then blinked (or so it appears from reading between the lines of what
I've seen). They both got back to negotiation, and with a better
understanding of to how much pain the other willing to take to get what
they want, this time they came out with an agreement.
Doesn't seems mysterious.
[snip]
Who are the next discontent couples?
And how do I protect myself and my customers from any problems these
kinds of events cause regardless of who the next players might be?
Christopher Woodfield wrote:
"...the companies have agreed to the settlement-free exchange of
traffic subject to specific payments if certain obligations are not met."So it does look like Cogent bent somwhat...I'm guessing they agreed to
pay some sort of "traffic imbalance fee"?There are other possibilities.
Maybe they agreed to pay a transit fee should they fail to carry the L3
user's requested traffic as far as possible before handing it off (cold
potato routing) and hand it off at the earliest possibility (hot potato
routing) leaving L3 to backhaul it across the L3 network to the user who
requested the data.
I doubt it. Cold potato is normally the first thing Cogent offers in a
situation like this. I'm guessing this went something beyond that. Cogent
would have offered cold potato well before the original depeering.
I have no specific information, but I'm guessing there is a per-mbps charge
that kicks in at certain ratio levels. Or, there may be a flat "port charge"
per month under certain conditions - Sprint did this many years ago.
Etc.
jc
I'm having a bit of trouble figuring out Level(3)'s goal in all this. A bit
of incremental revenue? For all of this trouble? I could understand feeling
that Cogent's ratios are a violation of their peering requirements and
depeering them on principle, but if that's the case, why back down for a
little cash?
Of course, various external pressures may have been brought to bear on
Level(3). Customers, regulators, press, creditors, etc.
- Dan
Eric Louie wrote:
Now, one really needs to wonder why the agreement could not be reached
*prior* to the depeering on 10/5It's not rocket science.
As people have pointed out repeatedly, this was surely not rocket science
since it wasn't a technical problem at all. It was a business conflict.It seems clear to me what probably happened. First-round negotaitions
failed 'cause Level 3 thought Cogent was bluffing (and perhaps vice
versa). Level 3 called the bluff, but it wasn't a bluff, and Level 3
then blinked (or so it appears from reading between the lines of what
I've seen). They both got back to negotiation, and with a better
understanding of to how much pain the other willing to take to get what
they want, this time they came out with an agreement.Doesn't seems mysterious.
It should. Level(3) knew that Cogent would partition. Why? Because they've
done it before, more than once. Their business model supports that strategy
(some would say, demands it). The Level(3) folks are well informed and would
certainly have anticipated this action.
The Cogent folks also knew, with a high degree of probability, that Level(3)
would carry out their threat. No one sends out a depeering letter unless
they are willing to pull the plug. Why? Because sometimes the other party
pre-empts you and downs the session before you can.
Peering is one of those things that seems very simple. On the small scale
that is correct. On the larger scale, especially when dealing with SFI
networks, the rules change and things get hairy. Things like ratios matter a
great deal when your traffic is in a zero-sum condition with ratio sensitive
SFI peers.
Cogent is an interesting case, as their peering decisions are typically made
with more-than-ordinarily ruthlessness.
[snip]
- Dan
I do not have any information on this particular arrangement, but can
speak to one possibility...
Even with cold-potato routing, there is an expense in handling increased
levels of traffic that is destined for your network. This increase in traffic
often has no new revenue associated with it, because it is fanning out to
thousands of flat-rate consumer/small-business connections (e.g. DSL)
where billing is generally by peak capacity not usage. It's also true that
some of the most popular Internet destinations will receive transit at
bargain rates because of their relative size and buying power.
A settlement fee that kicks in only on egregious ratios allows one to more
freely interconnect without bearing the full cost burden should the traffic
become wildly asymmetric.
/John
Hi John,
Even with cold-potato routing, there is an expense in handling increased
levels of traffic that is destined for your network. This increase in traffic
often has no new revenue associated with it, because it is fanning out to
thousands of flat-rate consumer/small-business connections (e.g. DSL)
where billing is generally by peak capacity not usage.
not true for cogent tho, we know that virtually all their traffic is usage based
transit customers
Steve
The traffic from Cogent creates additional infrastructure requirements on L3.
L3 may (or may not) be able to recover these costs as incremental revenue
from the recipients, depending on the particulars of their agreements. One
way of mitigating their exposure is to set an upper bound on uncompensated
inbound traffic.
Mind you, this is entirely hypothetical, as specifics of the Cogent/L3 agreement
are not available. However, it is one way to let everyone "bill and keep" for
Internet traffic without an unlimited exposure, and it is an approach that has
been used successfully in the past.
/John
Taking L3 & Cogent completely out of this discussion, I'm not sure I agree with your assessment.
I think everyone agrees that unbalanced ratios can create a situation where one side pays more than the other. However, assuming something can be used to keep the costs equal (e.g. cold-potato?), I do not see how one network can tell another: "You can't send me what my customers are requesting of you."
If your business model is to provide flat-rate access, it is not _my_ responsibility to ensure your customers do not use more access than your flat-rate can compensate you to deliver.
I think everyone agrees that unbalanced ratios can create a situation where one side pays more than the other. However, assuming something can be used to keep the costs equal (e.g. cold-potato?),
Cold-potato only addresses the long-haul; there's still cost on the receiving network
even if its handed off at the closest interconnect to the final destination(s).
I do not see how one network can tell another: "You can't send me what my customers are requesting of you."
Depeering seems to say exactly that, no?
If your business model is to provide flat-rate access, it is not _my_ responsibility to ensure your customers do not use more access than your flat-rate can compensate you to deliver.
Agreed... I'm not defending the business model, only pointing out that some folks may find it easier to bill their "peers" than customers.
/John
John Curran wrote:
Cold-potato only addresses the long-haul; there's still cost on the
receiving network even if its handed off at the closest interconnect
to the final destination(s).
And there's still revenue, as the traffic is going to customers (we all filter our prefixes carefully, right?). What's the problem with cold-potato again, or should we all just try to double-dip?
pt
I do not see how one network can tell another: "You can't send me what my customers are requesting of you."
Depeering seems to say exactly that, no?
No. Presumably, that traffic's still going to be exchanged between the two networks' customers. Depeering just says "go pay someone for transit if you want to talk to our network". Not talking to a network that depeers you is not a long term viable option if you're in the internet access provider business.
If your business model is to provide flat-rate access, it is not _my_ responsibility to ensure your customers do not use more access than your flat-rate can compensate you to deliver.
Agreed... I'm not defending the business model, only pointing out that some folks may find it easier to bill their "peers" than customers.
Seems like some people want to bill both. Not being an expert in Tier1 peering issues, it really seems like the only explanation for this depeering was L3 wanting to raise Cogent's cost of doing business...presumably as an attack on Cogent's business model of selling access way below the average Tier1 going rate.
For those who disagree, how does forcing Cogent to pay [anyone, not necessarily L3] for access to L3's network reduce L3's cost of carrying the bits that will flow regardless of whether Cogent's peering with L3 or buying transit to get to L3?
I actually can think of a couple possible explanations. Perhaps L3 wanted Cogent to interconnect with them in more places (so they wouldn't have to carry traffic as far), and Cogent refused.
If you have a customer in CA, and I have a customer in FL, and we peer, whats a fair way to move that traffic cross country? i.e. We both bill our customers...who pays to move the bits cross country?
Pete Templin wrote:
John Curran wrote:
Cold-potato only addresses the long-haul; there's still cost on the
receiving network even if its handed off at the closest interconnect
to the final destination(s).And there's still revenue, as the traffic is going to customers (we all filter our prefixes carefully, right?). What's the problem with cold-potato again, or should we all just try to double-dip?
pt
ah yes, double dipping. On-net traffic should be charged a lot less, because after all, it is double dipping.
/vijay
That is something that has always confused me about ratio based peering disputes.
Surely it is the responsibility of the content-sucking network to build and engineer to meet the demands of *their* customers (and build the cost of doing that into the pricing model). It appears to me that the content heavy networks are going above and beyond to work around the broken model that the content-suckers have.
What am I missing?
That it's a pure power play. Peering is only distantly associated with costs or responsibilities. It has to do with what company has the intestinal fortitude to draw a line in the sand and stick with it no matter how many customers cancel their service. Those with a critical mass of traffic and the right amount of guts win. Everyone else loses the peering game.
> What am I missing?
That it's a pure power play.
market position is important
Peering is only distantly associated with costs or responsibilities.
no, peering is entirely associated with costs or responsibilities.. what other
reason is there to peer ?
It has to do with what company has the intestinal fortitude to draw a line in
the sand and stick with it no matter how many customers cancel their service.
have to weigh up the gains and losses to see if that is a good or bad thing tho.
Those with a critical mass of traffic and the right amount of guts win.
markets are always stacked in favour of the larger players in that way.. saying
'hey i'm a little guy, give me chance' generally goes unheard
Everyone else loses the peering game.
not peering isnt necessarily losing, there are networks who would peer with me
if i turned up in asia or the west coast, but my cost to get there is greater
than sticking to transit.
to get a new peer, both sides need to feel they are gaining value
Steve
That argument works in both directions. I'm an eyeball network, I'll sit in my DLSAM and force all the content people to come to me. Isn't their responsibility to their customers to deliver bits to me?
Assume that both content and eyeballs are equally important. (If you assume one is more important than the other, this all devolves into "the less important should pay, period", which is not going to happen.) Why does the content network get to dump traffic instantly without paying for long haul, but the eyeballs have to carry it across the ocean / country / whatever?
You could argue that's The Way It Is. Eyeball and Tier One networks appear to disagree. Not sure they are wrong.
It seems reasonable (to me, at least) to ask that a "peer" share the cost of trading bits. Cold-potato does not mean the content network has to deliver bits to every DSLAM in the country. But asking the hosting provider with 10M ft^2 colos in SJC & IAD to carry some of that traffic to ORD, DFW, LAX, JFK, etc., seems like a fair compromise.
I think everyone agrees that unbalanced ratios can create a situation where one side pays more than the other. However, assuming something can be used to keep the costs equal (e.g. cold-potato?),
Cold-potato only addresses the long-haul; there's still cost on the receiving network
even if its handed off at the closest interconnect to the final destination(s).
Which is COMPLETELY AND TOTALLY irrelevant to the peer network. If your network can't cover the cost of delivering bits from the DSLAM to the CPE, why in the hell are you in this business?
You've been doing this for a very, very long time John. I know you know better. Stop trying to confuse the newbies.
I do not see how one network can tell another: "You can't send me what my customers are requesting of you."
Depeering seems to say exactly that, no?
Only if you are Cogent / L3 (or Cogent / FT, or Cogent / Teleglobe, or Cogent / $NEXT-DEPEER). Any other time a network gets de-peered, the bits still flow.
So I repeat, how can an eyeball network tell a content provider: "You can't send me what my customers are requesting of you."
The only way I can think to do that is to intentionally congest the path. (Which many eyeball networks actually do, now that I think about it.) But that might have an adverse affect on your customer growth.
If your business model is to provide flat-rate access, it is not _my_ responsibility to ensure your customers do not use more access than your flat-rate can compensate you to deliver.
Agreed... I'm not defending the business model, only pointing out that some folks may find it easier to bill their "peers" than customers.
I doubt they will succeed - at least in the long run, or even in the majority of cases. But stranger things have happened.
Just remember, turn-about it fair play. So they should be careful what they wish for.