John, you say there is no benefit to be gained by large providers using
anything other than private inter-connects. may i refine that question
slightly and ask: benefit **to whom?** to the large provider? If the
question of benefit is limited in this manner, i'd guess that your
statement is quite correct.
It's not a question of large or small; it's a question of
traffic volume. Creating multi-provider interconnects makes
sense, right up until the aggregation pushes the technology
into a higher-cost or higher-risk category. It's hard enough
getting stable high-speed equipment; intentionally bringing
multiple high-speed traffic flows together when you can easily
do a mesh of private interconnects makes little sense.
When you get big enough, you to can connect to the internet at the very
apex as demarcated by major naps in the us and soon in asia and europe.
*BUT* here is my question. Don't private interconnects essentially
provide a new apex for the internet? One that pushes interconnects at the
major exchange points down a level.
now you may say that from a competitive point of view this makes no
difference. perhaps. But what if the big four no longer see the need to
upgrade their bandwidth INTO and OUT OF exchange points?
For relatively small traffic volumes, the shared interconnects
work fine. Upgrading the bandwidth INTO and OUT of these points
is definitely happening, but there's often a higher payoff in
taking a major flow off the public interconnects into a private
interconnect. Providers do have good reason to upgrade their
public interconnects but principally after this phase of major
traffic migration to private interconnects has been completed.