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Re: peering charges?
From: Sean Donelan <SEAN () SDG DRA COM>
Date: Sun, 26 Jan 1997 17:33:59 -0600 (CST)

Or...since the business model of many (but not all) major web sites is
related to advertising, they should pay isp's for access to their audience
(client base of isp).  It is the audience that makes the web site more
valuable....not the other way around.

Another fine com-priv debate rehashed...

So if UUNET's web hosting division wants access to AOL's client base,
the payments should flow which way?  Personally, I think it would be
great, because something like 85% of our 'paid' traffic with UUNET is
to/from UUNET hosted web sites.

When an ISP has both consumers and producers, or buyers and sellers, the
value flows both directions.  You get inequities when there is an pricing
inbalance, e.g. international telephone rates.  Competitive markets tend
to force inbalances to zero.

The problem is in a free and open competitive market, any settlement scheme
with net difference between providers, will result in a new provider entering
the market whose business will maximize their net settlements.  International
call-back telephone services is one example.

Zero net settlements is actually a great barrier to entry for new providers.
-- 
Sean Donelan, Data Research Associates, Inc, St. Louis, MO
  Affiliation given for identification not representation
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