North American Network Operators Group

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Re: Transaction Based Settlements Encourage Waste (was Re: BBN/GTEI)

  • From: Adrian Chadd
  • Date: Sat Aug 22 14:17:29 1998

Mike Leber writes:

>The point is that anybody interested in making money would make sure that
>traffic didn't just balance out, they would develop a business plan where
>they maximized revenue from settlements where possible.

Already being looked into and implemented.

>Ok, so how about if you have a big dialup pool, or a R&D department is
>developing a new type of web index, or somebody is studying word frequency
>occurance of written english in web pages, or any one of half a dozen
>other perfectly legitimate uses that suck traffic instead of pulling
>traffic (and these two are just what I thought of in the second when I got
>to the period in your sentence, I could come up with hundreds much better
>uses based on what people are already doing as legitimate businesses

Bothered to see how backwards Australia does it?

>Ok, now think about what happens if a provider earns revenue from any of
>these applicatons.  Instead of charging for the bandwidth a provider could
>actually pay the users that generate this type of traffic.

Bothered to see how backwards Australia does it?

>At first glance that might be your impression as to what happens. 
>However, can't you see how this type of settlement encourages web crawlers
>to generate more traffic. 

Bothered to see how backwards Australia does it?

>Again, as just one of hundreds of ideas, imagine that a web crawler house
>has the choice of updating their database once every 30 days or once every
>15 days.  Now imagine they make the decision about this in light of the
>fact they get paid for additional traffic.  So now they have an incentive
>to update their database more frequently.  Wow, what a great service for
>the customer!  And as a kicker, they make more money from settlements!


>And web crawlers are just one application, and not the only one that sucks
>traffic from web servers.  And I can think of many more perfectly valid
>uses for other protocols.  Again, if you use your imagination, you can
>create a legitimate business based on currently existing online businesses
>and get the desired traffic flows. 
>Ultimately, in all of these cases less efficient algorithms and uses will
>be chosen in the direction that results in positive revenue, and waste
>will occur.

Okay.. lets just run through this again.
If you supply content, you lose. If you accept content, then you WIN from
a settlement-based peering arrangement?

Wow. I must be really backwards. Because, I would have thought that you'd
pay for services that you receive.

If I'm a dialup NSP *ONLY* then I can pretty much guarantee my traffic
will be asymetrical, and that I will be sucking lots and lots of traffic
compared to what I push.

If I'm a web hosting company, then I can pretty much guarantee my traffic
will be asymetrical, and that I will be pushing out more traffic than I pull.

Now, who should pay for what in today's internet? An internet which is
based on content provisioning?

In Australia, if you're a client of Telstra Internet, you pay 19c/meg in
pretty much all cases. You get a small discount on your traffic bill which
is dependant on what traffic you SUPPLY to their network, but thats the
whole point about "purchasing transit".

If you're a settled peer with a network, then you pay the network you
pull traffic off x c/meg, and they pay you x c/meg for traffic they pull
off you. 

If your traffic flows are symetrical, then you both win. 

If they're not, well the network which pulls the most traffic pays up.

It works in Australia. Hell, even with our heavily inflated pipes compared
to you guys. And you are all bickering over this when if you DID this your
interconnect fee per megabyte in a settlement based peering arrangement WITH
the source network transiting the traffic to the 'local' point of the
receiving network would be way below < 0.01c/meg .

I might be naive, but if there are any other technical issues with what I've
suggested then please, point them out in a nice, clear fashion :-)

So if you're a web crawler generating lots of incoming traffic (because
thats what a webcrawler does, doesn't it? downloads pages for analysis?)
then it would PAY for the traffic IT uses. Not BE paid for the traffic it
uses. Only when this webcrawler database is put on line and it starts
to supply lots and lots of content will people want to peer with it, and
it would win in settled peering.

Adrian, finding it mildly entertaining that AU is screaming for a more US-like
internet setup, and how the US seem to be after what AU have already been and