RE: UUNET Pulling Peering - Core Issues

[Michael Dillon <michael () memra com>]

On Sat, 3 May 1997, Hong Chen wrote:

> Essentially, the umlimited flat rate service offered by smaller
> ISPs will be gone, and replaced by metered services. That is, 
> you pay what you use. 

I think that's unecessarily alarmist thinking. You are correct that this
would happen if other companies continued to make decisions along the
lines of UUNet's recent announcement. However, other companies do have
choices here and most paths do not lead towards metered services.

ISPs who feel they have no choice are making a grave mistake and are
ultimately doomed. But ISPs who can seriously look at all their options 
will realize that the major backbone ISPs aren't quite as major as they
used to be. There are lots of options for action, some of which could be
so damaging to UUNet that they would pull back on what appears to be a
harsh policy. Of course, due to the NDAs that they are asking peers to
sign, we can't really be sure if UUNet's policy is as harsh as it appears
to be because we cannot be sure what kind of fees they are asking "peers"
to pay them.

> According to many major ISPs overseas, today's US Internet Centric
> status will not last long when Internet grows tremendously overseas, and 
> some day, US national ISPs either have to build their own International
> links, or they have to share the international link cost with 
> the oversea providers, just like today's telecom model.

I think this is the arena where the battle over settlements will actually
be played out, not in the USA.

> The regional ISPs will have to ask themselves 'does it
> make sense to charge $19.95 for a customer while this customer
> is sending unlimited number of emails worldwide, and making 
> unlimited internet phone calls worldwide?' To cover the cost, 
> should the regional ISPs raise the fee to $30/month for unlimited?
> Maybe a tired fee structure will make sense, like what Netcom is
> doing today.

There already are ISPs that charge $30 to $40 per month for unmetered
access to the Internet and that have always done so. They are doing quite
well too. Unlike what some would have you believe, Internet access is
not a commodity service.


Michael Dillon                   -               Internet & ISP Consulting
http://www.memra.com             -               E-mail: michael () memra com

The bottom line is track record.  Not track tearing.  Not track derailing.
But pounding the damn dirt around the track with the rest of us worms.
       -- Randy Bush


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