ABC Peering
2008-04-02 17:57The ABC does peer with Australian ISPs. I know, AARNet does.
The concept that peering is always cheaper than transit is intellectually dodgy. There's very little difference in price in being a member of the Palo Alto Internet Exchange and in taking transit in the PAIX colo facility. That's what you'd expect from competition: all competitors end up near the same price, those with higher prices fall be the wayside.
The difference in price in Australia between peering and transit lies in lack of competition: in undersea capacity, in long-haul capacity and in last mile cabling.
The vulnerability of undersea cables to damage means there are good non-economic reasons for government to insist on peering of major Australian ISPs. We just haven't seen a government which understands the issues enough to do that: I think the ACCC understands the issues, but the power to direct a particular network design lies with ACMA and they have a very "the market will decide" hands-off approach. As voice moves to VoIP an undersea outage won't just effect communications to the USA, but cross-network Australian voice traffic as well as cross-network Australian Internet traffic.
People don't understand how complex billing systems are. It's much better to have a few categories of charge and let the differences in costs within a category underwrite the headline charge. Then the billing system is much simpler. For the reverse scenario see traditional telephony. About 25% of the call costs are incurred by the call's billing. ISPs don't see themslves winning sales by having complex plans which pass on all cost categories to the customer but increase the overall charge by 25%.
This discussion also lacked some understanding of costs. ISPs are paying for the links into Ultimo (or to another peering point which passes on the ABC traffic, such as PIPE). The ABC are just looking at interfaces. A J-series router can present 24 optical interfaces at about $2K each, or you can use a switch at $2K for the chassis plus optics.