Observations of an Internet Middleman (Level3) (was: RIP Network Neutrality (was: Wow its been quiet here...

Rick Astley jnanog at gmail.com
Sat May 10 15:04:02 UTC 2014

That was an interesting read but it's not the whole story. Skip to the
TL;DR if you'd like but I'll attempt to explain what happened. What he
isn't saying is the roles of the companies involved have changed over the
last 10 years. Mostly gone are the days that content providers and access
networks each just gave a middleman/transit provider money to reach each
other. "Content provider" has expanded to become "content delivery network"
and "access network" has expanded their role to offer transit as well. If
these networks have a large amount of traffic between them and are able to
reach each other in multiple locations nationally what is the technical
reason a 3rd party transit network is required instead of a direct peering
relationship? From a purely technical perspective content and access at
that scale can peer directly cutting out the middle man.

The reality is an increasingly directly peered Internet doesn't sit well if
you are in the business of being the middle man. Now if you will, why do
transit companies themselves charge content companies to deliver bits? How
is it fair to be in the business of charging companies to receive their
bits and hand them to a settlement free peer on the hook to deliver them,
but not fair for content to just bypass the transit company and enter a
paid peering agreement with the company delivering the bits? In this case
paid peering is mutually beneficial to both companies involved and is
typically cheaper for the content company than it would cost to send that
traffic over transit.

What we have is a major shift in the market over the last 10 or so years.
So why are these large nationally connected "access" networks charging
Level 3 for ports? That's the elephant in the room here and to understand
that you have to go back to where (to my knowledge) this dispute first went
public. The most comprehensive description I have seen to date is the
following Youtube video: https://www.youtube.com/watch?v=tR1sLLOYxnY

I recommend the video before continuing. "Level 3" is really both Level 3
transit and Level 3 CDN. Level 3 has already had a long standing precedent
of justifying the right of an ISP to charge for content delivery. So what
happens when Level 3 greatly expands their content delivery business and
sends traffic to other ISP's over settlement free ports? The large access
networks say "hey, content delivery is a billable service, you should know"
and they ask Level 3 CDN for compensation. The middleman networks protest
and say "Charging for content delivery is only OK if we do it, but not when
you do it!" and their justification for this claim is made on the basis
that unlike access networks they a) Have a large network and b) send a full
table of prefixes.

So lets look at the first claim. Are the transit networks large? Yes, but
especially in the case of North American traffic destined for North America
they are typically smaller overall than the largest access networks who
arguably have the lions share of equipment tasked with delivering the bits
beyond just the colo.
The 2nd claim is mostly a strawman and this is why. Middlemen still carry
traffic not destined to directly connected peers but how they bill for it
is largely based on volume of traffic, not the number of prefixes
exchanged. The big content providers and the big access networks make up a
majority of the traffic on the Internet even if they don't make up a
majority of the prefixes.

TL;DR So the reason the ports are maxed out is the market has changed,
access networks have attempted to change peering agreements to match the
existing market conditions but the middleman networks are arguing they
should be exempt from the long standing tradition of charging for content
delivery they themselves helped to establish. Some middleman networks have
responded by refusing payment to access networks for delivery and as a
result, the paths have not been upgraded and remain congested.

End of TL;DR

The next part is (even) more opinion than fact so you are forgiven if you
stop here.  My opinion is this is a peering dispute more than something
that should fall under net neutrality. If content companies sent letters to
"middlmen" that said "In your statements to the public you made the case
that content delivery to ISP's should be settlement free so we have decided
to take your offer and refuse any further payment to you from here forward"
how would they handle it? Likely those companies would not only find
themselves congested but depeered.

A bunch of people say charging at both ends is double dipping but really
modern access networks are now at least partly filling the role of transit
as well as last mile delivery. Where "content" "transit" and "access" all
have a presence in the same colo, paying more money to send traffic through
transit first instead of just directly to access because of some dated
definition of what the roles of those companies are supposed to be doesn't
make sense to me. Hijacking NN to attempt to bring litigation into the
matter to protect an old business model from a changing market makes even
less sense. Seeing Level 3 publish half truths in what looks like an
attempt to mislead the public on the matter is disappointing. I would
expect it from maybe Cogent but I have higher expectations of Level 3.

Broadband providers obviously aren't without some blame in the matter
either. One of them is allowing customer satisfaction to be so low that
they are easy targets for misinformation as most the comments I have seen
on the matter to date are more emotional than rational. They have other
mistakes too but for the purpose of keeping this brief and because some of
them have been heavily documented elsewhere I'll save them for another day.

On Thu, May 8, 2014 at 1:18 PM, =JeffH <Jeff.Hodges at kingsmountain.com>wrote:

> Observations of an Internet Middleman (Level3)
> http://blog.level3.com/global-connectivity/observations-
> internet-middleman/
> See also...
> Level 3 accuses five unnamed US ISPs of abusing their market power in
> peering
> http://gigaom.com/2014/05/05/level-3-accuses-five-unnamed-
> us-isps-of-abusing-their-market-power-in-peering/
> "...
> I’d love to see Cogent, Google and other providers release their data
> next, so even if the FCC doesn’t want to pursue this, a growing cry of
> consumer outrage could push the agency to do something about a very real
> and difficult problem that’s crippling access to video content on 5 U.S.
> broadband networks. Level 3 didn’t name names, but based on the deals
> Netflix has signed and the complaints it has made about AT&T, I’m confident
> that AT&T, Verizon and Comcast are among the five. "
> =JeffH

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