Peering Math 101

Ask Dr. Peering

$Q: DrPeering - What is the cost of peering from Bucharest into Frankfurt? Does it make sense financially to peer? Dr. Heywood R. Floyd Clavius Base, TMA-1 Project A: Dr. Floyd - For this, let’s apply the Business Case for Peering: Assume*: Transport: 10Gbps circuit from Bucharest to Frankfurt cost ~ 2000 Euros/mo. Colocation Space: 800 Euros/mo Cross Connect in colo: 200 Euros/mo. 10G Peering Port: 2300 Euros/mo. Router (amortized over 2-3 years): 2000 Euros/mo. ======================================= Total monthly cost of Peering: 7300 Euros/mo *These numbers gleaned from discussions with my European friends. Total Effective Peering Bandwidth: 7000 Mbps (out of a 10Gbps transport) Calculations and Analysis ---------------------------------- First let’s calculate the best case scenario: What is the minimum cost for peering traffic? Minimum Cost of Traffic Exchange: 7300Euros/mo/7000Mbps = 1,04 Euros/Mbps That is, this is the best you can hope for. You completely fill the peering pipe with 7000Mbps, spiking higher of course but hopefully not hitting the ceiling and dropping packets, and the cost for traffic exchange works out to 1,04 Euros/Mbps.. Let’s assume the price of Internet Transit in Romania is 1,50 Euros/Mbps. The Peering Break-Even Point is 7300 Euros/mo / 1.5 Euros/Mbps = ~ 4.8 Gbps That is, if you can peer away over 4.8Gbps of traffic away for free over this peering pipe, then you will save money by peering instead of sending that traffic to your upstream for 1,5 Euros/Mbps. You can scale this up to 7Gbps before you need to upgrade the peering capacity to the IXP. If the price of Internet Transit is 3 Euros/Mbps as my Romanian friend shared with me, then the peering breakeven point is lower: The Peering Break-Even Point is 7300 Euros/mo / 3 Euros/Mbps = ~ 2.4 Gbps That is, if you can peer away over 2.4 Gbps of traffic away for free over this peering pipe, then you will save money by peering instead of sending that traffic to your upstream for 3 Euros/Mbps. You can scale this up to 7Gbps before you need to upgrade the peering capacity to the IXP. At this price point for Internet Transit in Romania, one can understand the attraction of peering in Frankfurt. As more Romanian ISPs do this, the price for Internet Transit in Romania will of course drop, demonstrating that the price of Internet Transit is is lower as one gets closer to network dense IXPs. You might be saying, “I don’t believe we can peer away that many Gbps of r traffic to the peering community at the IXP.” For you, take a look at tethering (aka remote peering) as a way to reduce the monthly cost of peering and therefore lower the Peering Break-Even Point: The Peering Break-Even Point is 4500 Euros/mo / 3 Euros/Mbps = ~1.5 Gbps using tethering to the DE-CIX. When enough traffic is peered at the IXP it may make sense to transition to a physical presence. In some cases networks also buy transit across the tethered or physical presence at the IXP to further utilize the transport in. I hope this helps - Q: DrPeering - I’m heading to the next NANOG and was curious: how cliquey is the peering community. How does one get in? Karl Childers Kaiser Networks A: Karl - First, the good news. The Peering Community is composed of a lot of really nice people, and several peering fora have things like speed dating or meeting software to facilitate meeting others. There are also some of us that enjoy meeting new folks and introducing them around. Having said that, the Peering Community is best described as a loose knit group of opinionated people that are rarely of one mind. There is a lot of (technology) religion here. These are folks that have technical knowledge and skills, and some degree of social skills, business savvy, and logic or legal aptitude. They harness these disciplines to facilitate peering and transit relationships. At the same time, their opinions are scattered across the spectrum on critical issues such as: Raised Floor vs. High-Ceilings Green Energy for Data Centers IPv6: Will I retire before I need to understand it? ISP Network Architectures The Best Load Balancer The best credit card and frequent flyer program Net Neutrality - good or evil spectrums Paid Peering - good or evil spectrums : the list goes on These are some of the areas where strong positions are held, gripped really. Friendships are made and sometimes lost based on alignment with or against some of these views and attitudes. You like those who is strongly in favor of your position. So the community tends to get periodically fractured into various groupings. With all of this fracturing, it is relatively easy to find a faction of people that you like, so you can easily join and participate. Most are willing to share their knowledge and do introductions to people that you need to meet. It is generally a very accepting group. On occasion, a united front emerges against a common enemy, and this brings together disparate segments of the community. Alignment occurs. Problem solving ensues. Support for each other warms harmony among the factions. Everyone can be outraged and rally behind a sense of “right” and “wrong.” These alignments tend to be short lived and fall apart in the absence of the continued common threat. The social structure of the community then relaxes and realigns. There are always other fires to deal with internally or externally. Until someone finds the next common enemy to unite against. In between these common enemy events the group is loosely held together with aligned interests (growing the peering community benefits everyone, doesn’t it?) My feeling is that positivity, identifying alignment, proceeding with recommendations of win-win solutions works better. The carrot is better than the stick. When was the last time a person, being badgered, has come around and said, “Thank you for publicly showing me the error of my ways. I will change now and succumb to your will.” It just doesn’t happen. Encouraging down the right path may take longer but it works better. So how does one enter this Peering Community? My prescription is to attend and participate in at least three peering events in a row during the first year. (Do not rotate representation, because no one will be seen as a regular.) Inculcation is gradual. The first time, observe the groupings, the collectives of people not from the same company, those that know each other. These may be regulars that you want to meet next time. The second time, reintroduce yourself to people you met the first time, learn, share, and observe the interpersonal dynamics. You will see the regulars, identify the hot button topics, learn about them and the networks they represent. After three events, you start being seen as a regular, so meet the other regulars that travel “the Internet traveling circus,” as they call it. The friendships, the cooperation, the sharing of information and resources, are all indications of inclusion. This is a stronger glue for a lasting partnership than the common enemy transitory alignment. It turns out that one can blow off a first-time attendee at a meeting, but if a person is a regular, you have to make nice or face socially awkward interactions at socials from here on forward. There is a great deal of market intelligence to be gleaned at these events too BTW. Not all of it is helpful, but much of it helps to validate market needs and wants, and you will learn where peering has succeeded and failed, and which approaches will work best with certain personalities. Do these things, enjoy the relationships and you will be successful. $ shapeimage_5_link_0