I have been aggressively looking for deals in servers in Europe for
anycasting. One thing which surprises me is the "setup costs" for BGP. Few
providers quoted additional $50-100 which looks OK but a few of them quoted
as high as $150 *extra every month* just for having BGP (no full routing
table, but just default route pointing). Is there's any technical logic
behind such heavy costs? I mean at the end of day we are all talking at
layer 3 and thus it does not involves any hard connection/physical work.
What other members pay for BGP setup costs?
There are starting to be a major difference in cost for supporting bgp. Taking a look at routing table size, many people are going to see troubles around 512k routes. Placing you on a device that doesn't need a full table or one at all will result in lower capital costs and lower operational costs as fewer features need to be toyed with.
The only thing that I can really think of is that the BGP sessions do take up extra CPU time and memory on the routing engine, so there is an additional cost to the provider in terms of needing more routers and/or bigger routers if they have lots of customers speaking BGP to them that they may not have factored in to their standard pricing.
I guess there is also some extra cost in terms of NOC staff and systems to monitor the sessions as well as providing any troubleshooting etc. that they wouldn't have to do with "standard" customers that are statically routed.
I know we dislike BGP on small connections (even though we do it), it is an extra administrative hassle that tends to be the most work on the smallest connections. Customers with multiple 10Gs tend to have small numbers of BGP related tickets than customers with a single fastE, given that, I can understand why soneone would want to charge, especially when it breaks the cookie-cutter templates that they are using for their low margin servers. While something might be technically easy, don't forget that breaking automated proccesses does tend to cause administrative pain, that could be what the fees are for recouping.
Edward's response nailed this one on the head. It has to do with the
additional support/hardware required to support a BGP session. Granted,
once a BGP session is established it rarely requires any tweaking, but I've
spent hours troubleshooting a downed BGP session because the client's IPS
signature update decided TCP/179 was malicious.
You also have to implement additional filters to protect yourself from what
your client can advertise. I'm lucky enough to work for a major ISP with
pretty sophisticated filters built off the public route registry, but not
all ISPs have this functionality.
We pay what our providers think they can get away with. Like most pricing
decisions, they're not based on any "technical logic", they're based on what
the market will bear. Feel free to turn the process around -- decide what
the service is worth to you, tell the provider of the service that price,
and let them decide if they want to provide it to you at that price. Don't
be too surprised if you get monkeys in exchange for your peanuts, though.
You also have to implement additional filters to protect yourself from what
your client can advertise. I'm lucky enough to work for a major ISP with
pretty sophisticated filters built off the public route registry, but not
all ISPs have this functionality.
Is it really that hard to use a simple prefix list containing the one
prefix they're allowed to announce and default deny everything else?
If it's built off a registry, the customer can change it without direct
coordination which is a huge labor saving activity.
I have been aggressively looking for deals in servers in Europe for
anycasting.
If you're looking for stuff in "Europe" (I'm assuming Western European
EU member states, rather than states bordering Russia or the Middle
East) one place you may wish to try is UKNOF (http://www.uknof.org.uk)
they have the UK equivalent of the NANOG mailing list, so will be able
to help you more with UK (and their neighbours) specific questions;
it's a different market there remember - "industry standards" are
different!
The UK and Ireland are also pretty good places geographically for
server locations, with lots of fat pipes to mainland Europe and across
the Atlantic to North America; there is a reason people like Amazon
put their data centers there.
Are you suggesting that you get worse service after you negotiate a better
deal with a particular provider? I mean, certainly the different providers
have different levels of quality, but my experience has been that with a
particular provider, you get the same service regardless of how well you
negotiated, assuming you eventually came to an agreement.
(quite often, in fact, I see the customer that asks for more... quite
often gets more, without paying more. We've all had that 'difficult
customer' that consumes far more support hours than what they pay
could possibly buy. Quite often, that same customer negotiated a
better deal, too. It's a cost of selecting for customers that are
good at negotiation that most businesspeople don't take into account.)
Back to negotiating for initial prices: as far as I can tell, this is
largely a matter of knowing the market. The high initial prices
are there so that the people that are unable or unwilling to put in
the effort to find what the real market prices are pay a lot more.
I know as my own business has progressed? the prices I pay even for
the same unit of commodities that don't fall in price (like rack
space) goes down fairly dramatically every year, simply because
I understand the market better.
To a certain extent, yes. It has been my experience (from both the service
provider and the customer point-of-view) that customers who aren't worth as
much to a supplier don't get as much "love", because the cost of losing
their business to a competitor is much less (or, in some cases, would be a
net win).
However, my main point was that if you are mainly concerned about price,
rather than quality of service (or, more precisely, the value-for-money
ratio between the two), you are likely to end up with a substandard service.
I will concede, however, that I didn't make that point particularly clear,
for which I apologise.
Whether $150/month or so just for BGP on a low-speed (sub-100M)
link is reasonable or not depends on the SP.
If there is 1 BGP customer, YOU, or even 1 to 10 customers, then it
sounds reasonable to me; even downright cheap, when you consider
deploying a custom service may require additional training of support
staff, more required involvement of higher level network architects,
and require additional review of future network changes.
And the don't know in advance how many times you will be calling in
about that BPG session, and requiring assistance from an engineer
well-versed in BGP, not just standard Frontline or 2nd level support
work.
> We pay what our providers think they can get away with. Like most
> decisions, they're not based on any "technical logic", they're based on
Are you suggesting that you get worse service after you negotiate a
deal with a particular provider?
To a certain extent, yes. It has been my experience (from both the service
provider and the customer point-of-view) that customers who aren't worth as
much to a supplier don't get as much "love", because the cost of losing
their business to a competitor is much less (or, in some cases, would be a
[snip]
An org that negotiated a lower price per service are not necessarily
"worth" less, because measurement of worth is complicated. Might
purchase more services, might require fewer support/"free consulting"
incidents, caused by issues that have nothing in the service
provider's control, such as customer-owned router crashing; they might
have more associates that will listen to their recommendations about
who to buy service from.. too little love may get an influential "I
recommend against using this provider, because...."
Support SLA, Service SLA, and all other expectations should be part of
the negotiation; otherwise you run the risk that your unstated
expectations will not be met, because there may be unstated
tradeoff/benefits removed for offering the low price that you did
not include in the negotiation.
If the amount proposed isn't worth the level of service, the provider
needs to disclose that upfront, probably in the form of a
counteroffer
> > ... Feel free to turn the process around -- decide what
> > the service is worth to you, tell the provider of the service that price,
> > and let them decide if they want to provide it to you at that price. Don't
> > be too surprised if you get monkeys in exchange for your peanuts, though.
>
> Are you suggesting that you get worse service after you negotiate a better
> deal with a particular provider?
To a certain extent, yes. It has been my experience (from both the service
provider and the customer point-of-view) that customers who aren't worth as
much to a supplier don't get as much "love", because the cost of losing
their business to a competitor is much less (or, in some cases, would be a
net win).
How is this communicated to the people doing the support? is there a
'cheap jerk' bit in the database? Until I got my own company,
working as the technical guy in another company, I was never
told what a customer was paying. I mean, I could see what plan they
were on, but as a technical person I don't see the price they are
paying unless I go directly into the billing database, and that sort
of thing is usually super secret.
From a "business logic" perspective, I agree that it seems like
you describe the way it ought to be. Sometimes at very small companies?
this is the case. I remember a few times, the boss telling me
"customer X is a big deal. go out of your way for them" - but that
happens less and less as the company gets bigger. Think, for
a moment; if it's not in the database in an easily accessible
manner, even if you do all the negotiation yourself, how many
customers would you need before you lost track of who underpaid and
who overpaid? for me, the limit would be around 5. I bet even a
professional relationship manager would have a hard time around 100
or so.
Of all my current providers, the worst response I get from sales
is from the provider that I'm paying full price for. I mean, maybe
that's because they see themselves as premium and I'm small?
but maybe that's because I showed weakness by accepting the list price.
Or maybe it's because when I met the salesperson I was driving a
cheap car and dressed for work. I don't know.
