Provider credibility - does it matter? was Re: Inter-provider relations

Fri Oct 25 20:48:08 UTC 1996

Jim Dixon <jdd at vbc.net> wrote:

>Europe heavily subsidizes the US Internet.  It's not just VBCnet: the
>European Internet community pays something like 90% of the costs of
>traffic between Europe and North America.  The same applies to the
>rest of the world.

Most of all Europe heavily subsidizes its own government bureaucracies.
In some places it's cheaper to drag a circuit to US and back than from
one European country to another.  There are numerous licensing problems.

Then, you forgot direct U.S. subsidies (like ICM program sponsored by NSF).
Without ICM, the access costs for European (and elsewhere) countries would
be quite a lot higher.

Finally, the situation will change when backbone carriers will truely
internationalize by expanding backbones beyond U.S., and when large
European companies will expand business to U.S. (some do -- like BT
which gave MCI quite a chunk of money, which at least partially were
used to build MCInet).  Some my friends used to work for Cable & Wireless,
which is moving into Internet business as well (in U.S.).

--vadim