Peering - Benefits?

Fri Oct 31 05:17:21 UTC 2008

On Thu, Oct 30, 2008 at 10:13 PM, Patrick W. Gilmore <patrick at ianai.net> wrote:
> On Oct 31, 2008, at 1:05 AM, vijay gill wrote:
>>
>> On Thu, Oct 30, 2008 at 9:41 PM, Patrick W. Gilmore <patrick at ianai.net>
>> wrote:
>>>
>>> On Oct 30, 2008, at 10:19 PM, vijay gill wrote:
>>>
>>>> This is probably going to be a somewhat unpopular opinion, mostly
>>>> because people cannot figure out their COGS. If you can get transit
>>>> for cheaper than your COGS, you are better off buying transit There are
>>>> some small arguments to be made for latency and
>>>> 'cheap/free' peering if you are already buying transit at an exchange
>>>> and your port/xconn fee is cheaper than your capital/opex for the
>>>> amount of traffic you peer off.
>>>
>>> One of us is confused.
>>
>> precisely.
>
> Well, I could also be confused, which would make two of us.  But I will
> agree with you here and say precisely one.
>
>
>>> Transit is _part_ of COGS, at least for most of the group reading this
>>> list.
>>> Finding transit "cheaper than your COGS" just means cheaper than you get
>>> it
>>> now.  And that in no way way means you should dump peering.  What if
>>> peering
>>> is cheaper than transit?
>>
>> Cost of transport, opex and capital to build out to a peering point,
>> ports for interconnect, vs the expected money saved by peering away
>> sufficient traffic is the analysis that will inform your strategy.
>> This is why I said if you are already at a place where you are buying
>> transit, it probably worth it to peer with the folks locally.
>
> None of that is in question.  However, you also said: "If you can get
> transit for cheaper than your COGS, you are better off buying transit and
> not peering."  So either you were confused, or .. well, let's be generous
> and say you were confused. :-)
>
> I'm glad you have cleared your confusion.

Yeah, I was using COGs as a shorthand for cost to build out to peering
locations, I should have really further broken it down into specific
cases.

/vijay
>
> --
> TTFN,
> patrick
>
>
>