Peering and Network Cost

Mark Tinka mark.tinka at
Sun Apr 19 21:34:10 UTC 2015

On 19/Apr/15 11:23, Baldur Norddahl wrote:
> So why is IX peering so expensive?
> Again if I look at my local IX ( they have about 40 networks
> connected. Each network pays minimum 5800 USD a year. That gives them a
> budget of 240000+ USD a year.
> But the only service is running an old layer 2 switch.

The age of the Ethernet switch has little to do with its performance,
unless it has everything to do with its performance.

> Why do these guys deserve to be paid that much for so little?

The exchange point operator do not typically interfere with what the
members do. That said, while it is not their job to grow your peering
traffic, it would make thier exchange point more successful if they
managed to grow their membership.

> Recently we had a competitor show up in the form of Netnod. However the
> pricing is almost exactly the same, although Netnod tries to deliver
> slightly more service.
> Seems to me that this an unsound market. The 40 dix particants should
> donate 1000 USD once and get a new layer 2 switch. Why does that not happen?

Unless it is the case, the old switch should not prevent growth of the
exchange point, unless, of course, it currently does.

> Does not look like it is a local phenomenon either. IX'es all over are way
> more expensive than they should be.

Most exchange point operators have staff that run the network, find
members, e.t.c. These salaries need to be paid.

If a member is unable to extract the most value from their peering
setup, there is very little an exchange point can do about that.

In short, it's not for everyone, despite its good intentions.


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