internet policy day 2 - workshop session no. 3 interconnection, ixps and voice-over-ip prepared for...
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Internet PolicyDay 2 - Workshop Session No. 3
Interconnection, IXPs and Voice-over-IP
Prepared for CTO by Link Centre, Witwatersrand University, South Africa
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Sessions Summary Day 1
– Session 1History and technical background– Session 2Market structure
Day 2– Session 3 Interconnection, IXPs and voice-over-IP– Session 4Governance and domain names
Day 3– Session 5The impact of telecommunications regulation– Session 6Internet specific policy issues
Day 4– Session 7Content on the Internet – Session 8E-commerce issues
Day 5– Session 9Internet tools for regulators– Session 10 Conclusion, review and evaluation
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnectio, IXPs and voice-over-IP
The purpose of this session is:– to understand how Internet interconnection
policies and economics have developed– to examine the technical and economic
operation of an Internet exchange point (IXP)– to review interconnection issues such as the
value of traffic and dominant operators– to look at some examples of voice over the
Internet– to review some policy approaches to these
issues and look at some likely future trends
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Topics of Discussion
History of Internet interconnection Interconnection terminology Interconnection agreements Internet exchange points (IXPs) Case studies: JINX and KINX Interconnection issues Regulatory strategies Trends Voice-over-IP
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
History of Interconnection
Why interconnect?– For routing of traffic (at least one
interconnection)– For efficient routing (multiple interconnections)
Co-operative era (ARPAnet/NSFnet period)– NAPs, development of ‘peering’ policies– Restrictions on commercial use
Commercial era– Private exchanges developed in parallel to NAPs– Negotiated bilateral commercial agreement
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Terminology
ISPs– Reminder: ISPs means IAPs– But what is an Internet access provider
Do Internet Cafés count?
– What is a “connection to the Internet”? From outside the US: international connections
Backbone ISPs– Operate national networks– Often have international interconnection
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Terminology
Peering– Peer = network of roughly the same ‘size’– Size might mean:
geographic reach traffic volumes customer base
Transit– When there is no direct link between two
networks -- traffic transits across other networks– Provided mainly by backbone operators
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Terminology
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Terminology
Traffic– Traffic is of increasing importance– Internet Protocol (IP) has no built-in cost
accounting– Possible to measure traffic with other protocols
Historically difficult and costly Becoming easier and cheaper with time
Internet Exchange Points (IXPs)– Centralised exchange facilities– Many ISPs exchange Internet traffic at each IXP
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Agreements
ISP/customer– Two way flow of traffic– One way flow of money (customer to
ISP) Connection fee Monthly rates (fixed or traffic based)
– Discounts for strategic customers– Customers might also be ISPs
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Agreements
ISP to ISP– Neither ISP is a customer of the other– Two way flow of traffic– Interconnection costs usually shared– ‘Larger’ ISP may charge smaller ISP a
traffic-based fee– Transit agreements are a special case of
ISP-to-ISP interconnection agreement
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Agreements
Multi-ISP exchange– IXP established– Multiple ISPs connect to the IXP– Multi-directional flow of traffic– Each ISP can still chose which of the
other ISP networks to interconnect with, and on what terms
– Sometimes the IXP operator has some over-riding policies
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Internet Exchanges
Technical overview of exchanges– Cabinets housing a number of routers (at least one
per ISP) and at least one switch– Connections from each ISP to the IXP– Redundancy is desirable
Pros and cons– Pro: Cost savings (costs can be very low)– Pro: Efficient traffic exchange– Con: Less redundancy than meshed interconnection– Con: Historically, IXPs have been congested
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Internet Exchanges
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Case study: JINX
JINX– Johannesburg Internet Exchange– Established late-1996
[stats from early 2000]
Traffic– Peak throughput 34 Mb/s
Cost of extra 34 Mb/s capacity– $360,000/month (SA half-circuit)– $120,000/month (US half-circuit)
Costs– $40,000 initial
set-up– $1,000 per month
‘Savings’– SA Internet
industry: $5.7 million annually
– SA foreign exchange: $2.5 million annually
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Case study: KIXP What happened?
– Nov 2000: Kenyan IXP goes live, initially connecting four ISPs
– Dec 2000: Communications Commission of Kenya (CCK) shuts-down KIXP
– Dec 2001: After a year of negotiation, KIXP reopens Why?
– Unlicensed service– Pressure from Telkom Kenya?
Effect of the shut-down on consumers– Delays in e-mail traffic– Slow web access, impaired international connectivity– Continuing failures of ‘national backbone’
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Issues
Determining value– Interconnection agreements tend to reward the
larger of the two interconnecting ISPs– But larger ISPs also ‘use’ the small ISPs network,
deriving benefits– There is value to the traffic flowing in each direction– Market forces essentially determine where the value
lies in each agreement– Strong incentive for ISPs to reach amicable
interconnect agreements: Need each others’ networks
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Issues
Dominance of backbone providers– Move from zero-charge ‘peering’ towards traffic-
based interconnect seem reasonable– But, this has happened at the same time as massive
consolidation of the Internet market– Four companies control 85-95% of traffic on the
Internet– US industry and government agree: no immediate
threat to a competitive industry– Regulators must pay attention to dominant players– Dominant players do not necessarily make good IXP
hosts
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Issues
The US-centric Internet…? – For both historical and economic reasons, the US
backbone is also the world’s Internet backbone– Routing between neighbouring countries is often
via the US -- this is not very efficient– One view: It isn’t fair that there is a one-way
flow of money but a two-way flow of traffic over international connections to the US backbone
– Alternative view: The US provides cost-effective transit to hundred of other countries using its national backbone
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Issues
Local exchange interconnection– End-users connect to ISPs via telephone
exchanges– ISPs lease telephone lines from telcos which are
connected to banks of access modems (or other equipment)
– In some places local exchange carriers (LECs) offer commission to ISPs on call revenue generated by customers connecting to the ISPs’ networks
Economic model behind many ‘free’ ISPs
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Interconnection Issues
Cable interconnection– Cable is a good alternative access
medium for connecting end-users to the Internet
– In the US, there have been concerns that exclusive deals made between cable operators and some ISPs may constitute unfair practice.
– Regulatory pressure has sped up the opening up of the cable access market
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Regulatory Strategies
Dangers of regulation Strategies
– Domestic competition– Protection from dominant players– Transparency
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Trends
Likely future trends – Move from free ‘peering’ to settlement
based interconnection– Prices for international Internet
interconnection will continue to drop steadily
– New protocols and better traffic management will allow ISPs to offer increasingly differentiated services
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Voice over the Internet
Voice over the Internet– Sample applications
Internet user <--> Internet user Internet user <--> telephone users Bulk shipping of international voice traffic over Internet
links
– Regulatory responses Ban/limit -- only partially effective Promote
– Note: Voice-over-the-Internet is not the same as Voice-over-IP. IP can also be used in private networks.
CTO / DFID Internet Policy workshop, Jamaica, 22-26 April 2002
Summary Interconnection agreements have moved
from co-operative to commercial over time Interconnection happens at all levels Agreements are based on the perceived
value of the connection to each party Internet exchanges are a technically
efficient and cost-effective way to connect multiple networks
Voice over the Internet is eroding traditional telephony pricing models
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