I know that you were using mci as a case in point, i'm just
frustrated that we seem to cycle through this same issue at
least once a quarter.
I wholeheartedly agree that there are things that don't make
sense to do with peering, but that's what happens in a regulated
environment. whether it's regulation by the ixc's or by the fcc,
is no matter. regulations can't optimally fit every scenario.
what was wrong with the local exchange model for traffic between
large networks? cost, for one. because many large internet providers
are now long distance carriers as well, they already have shared
infrastructure. why pay someone else (especially a lec) to exchange
traffic? if 85% of the traffic i pull out of a nap is to sprint/uunet/
bbn why should i maintain 6 ds3's to that nap?
i (personally) like the idea of keeping local routes local at exchanges,
but there are issues to work through. it's going to take a non-trivial
development effort to make it happen (tag local routes in bgp and only
advertise them to the nap local providers). say you're a national sp and
i'm a mom&pop. you want to send me only the routes that originate in my
local area across the nap. i however, want to send you all of my routes -
they're all local. how do you, as the nsp, keep the rest of your
infrastructure (outside of the local customers) from knowing that my routes
exist? you might localpref them, but then they serve as backup for all of
your customers' traffic to me should i lose my transit provider. you might
filter them out of the announcements at all sights except for those that you
advertised as local to me (yuck). and if a customer get's poor performance
through the nap to one of my customers? do you remove the announcements of
that network? as i expand into other markets, won't my addressing be
necessarily geography based lest i either break large aggregates or advertise
routes that really aren't local to you? 
how do you keep me honest?
i like the idea of ixc's allowing zero length circuits within their premisis.
is it possible? would ixc's allow it?
Jeff Young
young@mci.net