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

  • From: Michael Dillon
  • Date: Sat Aug 22 14:22:04 1998

On Sat, 22 Aug 1998, Mike Leber wrote:

> Michael, I've met and talked with you several times and have the general
> impression you're a relatively creative guy. 


> I find it hard to believe
> that you are myopic to the extent of not being able to imagine these and
> other uses... unless the actual goal of your proposal is to have dialup
> providers and web crawlers get paid for existing.

Well, I can imagine them but I can also imagine solutions to them. For
instance, rate-limiting can be applied on either side of the peering
interface. And if both peers try to attract legitimate sucking users then
chances are that both peers will get some of them and the traffic flows
will even out somewhat. Also, if it does not make economic sense for peer A
to have an interconnect with peer B in a specific city, then they won't do
it. This greatly reduces the incentive for peer B to sign up customers to
suck from A because all of a sudden, those customers will either lose
connectivity or that traffic load will suddenly shift to peer C who sells
transit to peer A.

I think that most companies will think through these issues before acting
rather than just taking the simplistic view that it is good to suck huge
amounts of traffic from a peer. Also, this is an entirely hypothetical
scenario so the actual implementation could differ considerably. 

Consider the fact that in order to make this work, both peers need to
supply a settlement arbiter with a full city-to-city link map with
route-miles and with a price list to determine the value of transit
consumed. We could just as easily say that if the traffic is out of
balance by a ratio of more than 2:1 then we will examine the transit
consumed on both peer's networks based on the maps and the
source/destination addresses. Then those numbers will be balanced against
one another and the peer who uses more transit than they contribute will
pay a settlement fee. Now it becomes a lot harder to sign up legitimate
sucking customers that you know will create a settlement imbalance.

> 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.

I don't think that the future is as deterministic as you believe it would
be. For instance, what if you sign up a webcrawler, and then once they
have a good database, they host a search engine for multimedia content
with thumbnail pictures, video and audio clips. All of a sudden they
become a net sender of traffic. You can't control what your customers do
with their net connections.

Michael Dillon                 -               Internet & ISP Consulting
Memra Communications Inc.      -               E-mail: [email protected]
Check the website for my Internet World articles -