Internet Exchange Points: A Business

1
Internet Exchange Points A Business Policy
Perspective

• AFIX Decision-makers Workshop
• Session 1

AFIX-TF, ltLocationgt ltDategt
2
Introduction

• African Internet Service Providers Association -
  AfrISPA
• African Internet Exchange Task Force - AFIX-TF

3
Types of traffic exchange

• The Internet would not exist without agreements
  to exchange traffic!!!
• Competitor ISPs must co-operate to serve their
  clients
• Two main forms of traffic exchange
• Transit sell access to all destinations in
  routing table
• Peering access to each others customers

4
Transit More detail

• Business relationship where one ISP provides
  (usually sells) connectivity to all Internet
  destinations
• Carries traffic to/from third parties, including
  own customers AND every other destination
• Bilateral business technical arrangement
• Defined price, usually by volume (Mbps)
• Generally includes Service Level Agreement (SLA),
  installation Network Operations Center (NOC)
  support

5
Peering More detail

• Business relationship where two ISPs give
  reciprocal access to their own customers
• They will accept traffic from each other and from
  each others customers
• BUT there is no obligation to carry traffic to
  third parties
• Bilateral business technical arrangement
• No cash payments (more like barter) no
  settlement
• No Service Level Agreement (SLA)

6
Peering vs Transit
7
Economic Choices

• An ISP cannot peer with every other ISP in the
  world (10,000)
• So most ISPs try to do both
• Exchange as much traffic as possible with peers
  AND
• Pay for the rest
• ISP goal Minimise transit to minimise costs

8
Politics of peering

• Large ISPs that sell transit to developing
  countries are nearly always US, European, or
  Japanese-owned
• In most developing countries, domestic ISPs do
  not peer with each other!
• Any country whose ISPs do not peer with each
  other relies exclusively on transit
• Needless export of capital
• Effectively subsidising the developed world
• Developing country payments for transit are not
  small!

9
Overseas Interconnection Costs

• Using your upstream provider to exchange local
  traffic over a trans-continental link is expenive

• Bw International Local
• 64k 1,687 190
• 128k 2,386 274
• 256k 3,375 378
• 512k 4,773 535
• 1MB 6,750 757
• Telkom Kenya Bandwidth Tariffs Dec. 2001

10
The alternative IXPs

• IXP Internet Exchange Point
• Places where ISPs come to interconnect with each
  other clearing house for Internet traffic
• Keep local traffic local
• IXPs are the keystone of the entire Internet
  economy.
• Cisco Systems

11
Local Infrastructure
Gateways
Local ISPs
Internet Exchange Point
12
Keeping local traffic local

• ISPs within a region peer with each other at
  local exchange
• No need to have traffic go overseas only to come
  back

USA
200-900ms
200-900ms
200-900ms
5-20ms
13
IXP Benefits

• Better quality
• Cash savings
• Added value
• New revenue opportunities

14
Better Quality

• Reduced delays
• Improved performance

5-20ms
15
Cash savings

• Bw International Local
• 64k 1,687 190
• 128k 2,386 274
• 256k 3,375 378
• 512k 4,773 535
• 1MB 6,750 757
• Telkom Kenya Bandwidth Tariffs Dec. 2001
• Africa loses over US400 million each year for
  traffic exchange via other continents

16
Added value

• Metcalfes Law The usefulness of a network
  equals the square of the number of users
• Connect any number, "n" of machines whether
  computers, phones or even cars - and you get n
  squared potential value.
• n21 n22 n23 n24 n25 . n2n

17
Added value II

• A strong domestic Internet industry creates
  high-paying knowledge worker positions
• Domestic traffic exchange reduces the importation
  of foreign content and cultural values, in favor
  of domestic content authoring and publishing

18
New revenue opportunities

• Streaming video/audio
• Video-conferencing
• Telemedicine
• e-Commerce
• e-Learning
• e-Governance
• e-Banking
• E-Anything!

19
IXPs In Africa

• Uganda UIXP launched June 03
• Tanzania TIXP semi-operational
• South Africa JINX
• Mozambique MOZ-IX
• Zimbabwe ZIX
• Egypt EG-IX
• Nigeria small Ibadan IX
• Kinshasa operational

20
Critical Factors for IXPs

• National exchanges
• Political support
• Policy reform (where necessary)
• Regulatory provisioning
• Regional co-operation
• Strategic partnerships
• Critical infrastructure

21
IXPs Things to Do

• Any peering/IX initiative involves 10 technical
  work
• The remaining 90 is relationships
  (socio-political engineering)
• Official regulatory support
• Definition of internal peering policy framework

22
Next steps

• Establish national IXPs
• Create opportunities for the emergence of
  regional carriers facilitating regional
  peering/continental transit
• Promote cross-border links and inter-country
  infrastructure

23
SAT-2, SAT-3/WASC/SAFE, SEA-ME-WE, ATLANTIS 2,
FLAG
Source CTiA Report 2002/03
Current African Submarine Fibre Connectivity
Mostly Perimeter
24
Planned inter-country fibre COMTEL
Source CTiA Report 2002/03
25
Planned inter-country fibre SRII
26
Planned inter-country fibre EADTP