[11065] in Commercialization & Privatization of the Internet
Re: What is an "Internet reseller"?
daemon@ATHENA.MIT.EDU (Karl Denninger)
Sun Mar 20 02:18:42 1994
From: karl@mcs.com (Karl Denninger)
To: stpeters@dawn.crd.ge.com
Date: Sat, 19 Mar 1994 00:54:34 -0600 (CST)
Cc: fair@apple.com, com-priv@psi.com
In-Reply-To: <9403190054.AA02443@swan-song.> from "Dick St.Peters" at Mar 18, 94 07:54:07 pm
> That there are not settlements is a fiction. The whole US Internet
> runs on coarse-grain settlements between providers and their customers,
> using bandwidth as a coarse indicator of traffic, and where the
> relation between bandwidth and traffic breaks down, AlterNet and OARnet
> are willing to use a finer grain.
>
> It is only when dealing with each other that NSPs operate on a "no
> settlements of any kind" basis. This 1) lets the big providers make
> the small ones subsidize them, 2) creates a barrier to entry, and 3)
> forces the sorts of artificial distinctions that distort the truth you
> stated: bandwidth is bandwidth.
>
> --
> Dick St.Peters, Gatekeeper, The Pearly Gateway; currently at:
> GE Corporate R&D, Schenectady, NY stpeters@dawn.crd.ge.com
I don't know where you get <this> piece of fiction, Dick, but its just
plain wrong.
The fact is that every CIX member, large or small, can shove the same
amount of data through the CIX routers -- ONE T1. Why? Because that is
the form of connection to San Jose.
If you buy a second one, I would expect you to pay a second fee.
If anything, small providers benefit from this situation. Why? Well,
MCSNet gets, for its $10,000, connectivity to the direct customers of 30
providers. What to guess what I'd have to pay for that if I wasn't
a CIX member? If the CIX didn't exist then the other national and regional
providers would have other arrangements -- but if you think that my portion
of that cost wouldn't be billed back to me you're nuts.
Alternet probably doesn't give a tinker's damn about this, as most of those
places it goes already WITHOUT the CIX! However, even if it gets
connectivity to ONE provider for that membership fee I bet it is a good
deal overall.
The CIX is of less importance to international or national providers. It
is of <extreme> importance to small regional companies like ours.
I'll say it again -- MCSNet would not be in this business were it not for the
CIX. Anyone to claim that it "creates a barrier to entry" is misrepresenting
the truth. If anything, it has lowered the bar SIGNIFICANTLY to entry;
previous to the CIX you would have had to spend much, much more negotiating
with all the other network companies out there before you could sell a
single bit of connectivity!
This all assumes that the members operate as they agreed to when they put
pen to paper. IF AND WHEN someone can demonstrate that this is not the
case, I'll be the first to raise hell here and elsewhere about it, and set
up a competing interchange point right here in Chicago. Have CISCO gear,
will power-up if necessary.
If you think you have a better model, then set it up and operate it. If
you're right the providers will flock to your model and the CIX will die
for lack of nourishment. If you're wrong you go bankrupt, which is what
you deserve if you have a poor idea in the business world. Until you can
present <some> shread of evidence that supports your position, or are
willing to demonstrate the correctness of your vision, you're doing nothing
other than snarking at a VERY successful interconnection policy that has
kept by-the-byte settlements out of the hands of individual users for over
three years.
--
--
Karl Denninger (karl@MCS.COM) | MCSNet - Full Internet Connectivity (shell,
Modem: [+1 312 248-0900] | PPP, SLIP and more) in Chicago and 'burbs.
Voice/FAX: [+1 312 248-8649] | Email "info@mcs.com". MCSNet is a CIX member.
