[kictanet] State Wrong on Internet Exchange Point , is it true

Wed Dec 30 16:37:02 EAT 2009

Thanks Mich,

Quiet enlightening i must admit, i wonder what is going to happen with all
this mergers and acquisitions in the data market, lets adopt a wait and see
attitude to see what happens in 2010.
Regards

On Wed, Dec 30, 2009 at 4:27 PM, Michuki Mwangi <michuki at swiftkenya.com>wrote:

> Hi Barrack,
>
> Speaking for self; let me try and explain some of the factors that
> trigger the establishment of IXPs. (am intentionally staying clear off
> the issue and instead providing background to hopefully enrich the
> follow-up discussions)
>
> 1) Cost of transit - if there's always going to be a high cost of buying
> transit capacity (buying access to other networks). This is often what
> we call buying upstream service from an international service provider
>
> 2) More than 3 ISPs in a market - If there's more than 3 providers in
> one market, it makes economic sense to bring down their costs by
> exchanging traffic destined to each in a place thats within their
> control and not controlled by their upstream provider. Most upstream
> providers wont give you a local and international bill for traffic
> exchange. If there are two providers, direct interconnects would be
> sufficient.
>
> 3) Open Other opportunities - Content hosting, content delivery and
> content creation will most often take root if theres a local market.
> IXPs serve as a local market where folks with content can access
> eyeballs at "peering" costs.  Peering is often referred to as exchange
> of traffic between two networks at no fee.
>
> If the cost of transit is lower than that of peering and there are less
> than 3 providers in a market, the economic benefit of an IXP will be
> negligible.
>
> The question here is; what triggers more than one IXP in a market and
> whats defines the market boundary. IMHO the market boundary is often
> defined by the cost of leasing circuits. For instance the point where
> the cost of leasing a circuit of 1mbps from one point to another within
> a certain radius point A is often value X, beyond to radius point B the
> cost is value Y hence radius point A boundary is the market boundary.
>
> Having defined the market boundary and a prime example is Nairobi, would
> be worth to start the discussion on what would trigger having more than
> 1 IXP.
>
> At this stage, its worth getting to know that there are two main types
> of IXPs i.e non-profit and commercial IXPs. In addition, its important
> to know that ISPs' have is called peering policies. The peering policies
> basically define the rules of engagement for members at the IXP. The
> most common one are bilateral or multi-lateral peering policy. In
> bilateral it means each member will have to negotiate with every member
> at an IXP (IXP is not involved) in order to establish peering. In a
> multi-lateral it means every member is subject to the same peering
> policy i.e peer with everyone at the IXP. As you may have guessed it the
> bilateral peering is most popular and preferred peering policy at most
> IXPs. This allows for ISPs to selectively decide whom to peer with.
>
> As a result, in any market there are small and large players. The large
> players have the ability to selectively decide whom to peer with will
> leads to the small players buying transit from the large players. Since
> the cost of transit is often higher than that of peering, other IXPs
> will emerge to cater for those who cannot easily fit into the existing
> IXP. The key aspect for this new IXP will be the peering policy in place
> to attract membership. The new IXP can also take the shape of commercial
> or non-profit.
>
> Please take a look at www.pch.net and see how dense IXPs are in Europe.
> Some cities like Paris and London have more than 1 IXP operated by
> different organizations or competing IXPs and both commercial and
> non-profit.
>
> Consequently, IXPs in different markets are never directly
> interconnected and for this very same reason, competing IXPs in the same
> market would not be interconnected. As a result, its common to find an
> ISP participating in IXPs in different markets i.e in Nairobi and in
> London and also in other competing IXPs in the same market. For an ISP
> the more they can peer the lower their costs.
>
> Countries like South Africa have more than one IXP in different markets
> i.e one in Jburg, another in Grahamstown, and the recently
> re-established Capetown IXP. Other countries have many players (large
> and small) and with lots of content being created in those markets
> having more than one IXP is often feasible each attracting a different
> group of ISPs based on their peering policies.
>
> In conclusion, the key point to remember is that an IXP will remain
> viable if its able to reduce the cost of delivering packets from one
> network from another. If its expensive then the cost of delivering
> packets from one network to another will be same as transit costs and
> therefore diminish its own value. Unless the IXP is providing access to
> premium content that would otherwise be accessible via transit costs its
> less likely to attract membership. Lastly, an IXP is just a Switch. The
> question to have in mind is what attracts folks to come connect to your
> switch where there are more than one.
>
> I hope that gives sufficient background and info to enrich this
> discussion further.
>
> Regards,
>
> Michuki.
>
>
> Barrack Otieno wrote:
> > Listers,
> >
> > I was  going through an article in the East African standard with the
> > above mentioned title by the CEO of  KIXP published on Sunday Dec  2009
> > in the East African Standard, am  wondering is there a business case
> > other than the security considerations highlighted  that justifies the
> > GIXP and if we could be allowed to access it or is it classified info?,
> > in addition the writer has mentioned the Strengths of KIXP however i
> > would also appreciate to know the weaknesses since they might justify
> > the need for GIXP bearing in mind the fact that we are just coming out
> > of the woods in so far as monopolies are concerned as i try to digest
> > the article in any case having gone through
> > http://www.bgp4.as/internet-exchanges it is evident there are a few
> > developed countries with more that one Exchange point eg South Africa ,
> > the US, Sweden, Singapore, Russia and the UK, somebody educate me.
> >
> > Regards
> >
> > --
> > Barrack O. Otieno
> > Administrative Manager
> > Afriregister Ltd (Ke)
> > P.o.Box 21682
> > Nairobi 00100
> > Tel:
> > +254721325277
> > +254733206359
> > +254202498789
> > Riara Road, Bamboo Lane
> > www.afriregister.com <http://www.afriregister.com>
> > www.afriregister.co.ke <http://www.afriregister.co.ke>
> > ICANN accredited registrar.
> > Skype: barrack.otieno
> >
> >
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-- 
Barrack O. Otieno
Administrative Manager
Afriregister Ltd (Ke)
P.o.Box 21682
Nairobi 00100
Tel:
+254721325277
+254733206359
+254202498789
Riara Road, Bamboo Lane
www.afriregister.com
www.afriregister.co.ke
ICANN accredited registrar.
Skype: barrack.otieno
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