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Re: [RRG] some musings on PI v. PA, and assumptions, requirements, and tradeoffs



On Fri, Jul 13, 2007 at 12:49:09PM -0400, Noel Chiappa wrote:
>     > From: David Meyer <dmm@1-4-5.net>
> 
>     >> If you have a site which is providing content to a large part of the
>     >> Internet, it makes sense (in a system-wide analysis) to have the
>     >> routing support multi-homing for that site, because while everyone
>     >> pays part of the costs, everyone also benefits.
> 
>     > That makes sense, although in the current regime even in
>     > the case of a large multihomed content provider, the core
>     > (network) still bears the burden while the site gains the
>     > benefit.
> 
> This doesn't make that much economic sense to me. I reason as follows:
> 
> Assume there were no large content providers, just lots of small sites, each
> making money. In that case, the network would have to carry as much overall
> traffic, but somehow I don't think people would have this reaction 'oh, those
> sites are getting something for free, and so the network providers should get
> more money from them'.
> 
> Yes, a large content provider does use lots of bandwidth - but it has to get
> that bandwidth from someone (unless they own their own fiber everywhere).
> 
> I tend to view this as a straight economic tussle - like that between a
> manufacturer and a union. There's a pie (the income of the content provider),
> and the network providers and the content providers are fighting over it.
> 
> I might further observe that it's only this way because the network business
> has no pie to fight over. If Google/etc were barely breaking even, and the
> network providers were raking in money hand over fist, I bet you'd see the
> exact reverse of this argument: 'oh, those network guys are only making money
> because of our content, so we deserve a share of their pie'.
> 
> I am not impressed by either argument.
> 
> Last I heard, the telephone companies weren't asking for a share of the
> profits of mail-order companies who take their orders over the phone, either.
> 
> Right now, network services are not 'properly' valued by the market (in part
> because there was overspending on capital investments like fiber). The same
> thing happens in other markets too (e.g. commercial buildings). Eventually
> things will return to a reasonable mean.
> 
> 
>     > In some sense everyone benefits (as you say), but that cost/benefit
>     > tradeoff isn't rationalized (i.e., there's no economy that assigns
>     > resources accordingly).
> 
> I'm not sure I quite understand this? Are you saying that that costs aren't
> perfectly assigned, that some people are getting something for free?
> 

	Basically, its all about routing state. If I'm a
	multihomed site and I inject a PI prefix, then I gain the
	benefit but the core networks bears the cost (state). So
	in that sense the cost/benefit is misaligned.

	Dave


	

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