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North American Network Operators Group Date Prev | Date Next | Date Index | Thread Index | Author Index | Historical Re: Provider credibility - does it matter? was Re: Inter-provider relations
On Fri, 25 Oct 1996, Jeremy Porter wrote: > The Economist's model is incomplete, however I really doubt > it could be argued that Europe subsidizes the US Internet. If someone in the UK accesses a US Web site, the European provider pays 90% of the cost involved. If someone in the US accesses a UK Web site, the European provider pays 90% of the cost involved. On our network -- someone with more comprehensive stats might want to step forward at this point -- more Web traffic flows from the UK to the US. That is, there is a small net flow of _benefit_ to the US and a very large net imbalance in _costs_ to the UK. In order to argue that there is no subsidy to the US, you have to argue that US Web sites are somehow 'worth' much more than UK Web sites. Us simple-minded folk just look at the invoices. > A large reason the cost of international leased lines are so > high is due to protectionist tarrifs in international telecom. That's true. But European networks pay the _entire_ cost of moving data across the Atlantic. If x.net is an ISP in San Jose CA and runs a T1 to MAE West for $170 a month and y.net.uk is an ISP in London and runs a T1 to MAE West for $40,000 a month, they are regarded by their would-be peers as on a par -- although the costs of one are 235 times the cost of the other. (These numbers are not imaginary.) > I understand it is cheaper to buy a leased line from the > us to Europe than the other way around. Circuits don't have directions. Or more precisely, we buy them in pairs: a circuit from California to London always comes with a circuit from London to California. To look at it another way: we have an office in San Jose, California, and an office here in the UK. We can and do get quotes from both countries. If there was a difference, we would just go with the cheaper quote. > (This at least has > been discussed on nanog before). At any rate the most > the costs differences will do is is subsidize US access to Europe. This argument doesn't make any sense, but in any case you are conceding that Europe subsidizes the US Internet. > It doesn't effect the cost of US-US internet. It does. If the US Internet paid 50% of the costs of Atlantic traffic, then a large sum of money would be transferred from US providers to UK providers. (Because the costs of one would go down, and the costs of the other would rise.) > Until someone invents a metric that measures Host Value, > there will be no easy way to estiablish the relative value of two > networks to each other to set up rational economic models between > providers. This seems to be an attempt to introduce the notion that American Web sites are worth ten times as much as any others -- without spelling out a silly idea in full detail. ;-) Having said all this, I will repeat that my main interest is in establishing the point that the Economist's model of the Internet is not valid. I am not crusading for a more equitable sharing of the costs of intercontinental data circuits; that will come naturally as time passes. -- Jim Dixon VBCnet GB Ltd +44 117 929 1316 fax +44 117 927 2015 http://www.uk.vbc.net VBCnet West +1 408 971 2682 fax +1 408 971 2684 - - - - - - - - - - - - - - - - -
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