AT&T-Cogent Peering Points ‘Completely Saturated,’ Cogent Says

Not so simple, responded AT&T. It and other ISPs have been arguing about whether paid peering is needed with websites, and if the issue impinges on net neutrality. FCC officials have said they're studying the issue, following a public uproar that has brought at times the agency’s website nearly to a halt over last month’s net neutrality NPRM that critics say could create a slow lane for Web content.

The traffic graphs (http://bit.ly/1lep2SV) compare Cogent’s throughput from June 1-8, 2013, with the same week this year. In New York, Cogent’s outbound traffic usually peaked near 50 Gbps during the primetime hours of 2013, but hit that limit only briefly Sunday evening. In contrast, its New York graph from this year shows outbound traffic essentially capped at 50 Gbps for most of the daytime hours. In Atlanta, Cogent hit a 40 Gbps cap during typical waking hours of both 2013 and 2014, with outbound traffic that would not exceed that throughput. Level 3 last month released similar graphs (http://bit.ly/Uxi8Dc) showing the congested interconnection it faces (CD May 7 p11).

With congestion comes packet loss and quality degradation, Schaeffer said. That hurts companies like Netflix, forced to sign paid direct agreements with ISPs, and it hurts ISP customers, who requested the traffic, he said. The problem is “the physical connection between the two networks,” he said. That can be easily fixed if AT&T opens up some ports, or adds new equipment -- which Cogent is willing to pay for, Schaeffer said. Cogent is willing to “incur the capital costs associated with augmenting its interconnections with these networks to address the current level of traffic congestion,” it said in a March news release (http://bit.ly/1v5E9Wl).

"To talk about the Cogent relationship would violate the terms of the agreement we have,” said AT&T Senior Vice President Bob Quinn. “Perhaps they've already done that by sharing a bunch of graphs with you that are related to a contract. I'm not going to do that.” What Cogent suggested -- or what Netflix Vice President-Government Relations Chris Libertelli suggested at a Wednesday Aspen Institute event (CD June 12 p3) -- that it’s just about opening up a port, “is absolutely not true,” Quinn said.

Not Just Ports

"You have to build the capacity,” Quinn told us. “This stuff has to be carried on fiber. And so we sell that service to a transiting service.” AT&T’s peering policy (http://soc.att.com/1lerhWr) said a peer must maintain a balanced traffic ratio between its network and AT&T -- a new peer must have no more than a 2:1 traffic ratio into AT&T, Quinn said. Existing peers will be expected to work with AT&T. “The charts that were shared show a traffic balance” that “looks like it’s about 10 to 1” or more -- five times higher than AT&T’s peering ratio allows, said Quinn. If a transit provider can’t come to a way to ameliorate the out of balance condition, ISPs can offer to sell them a transiting service, Quinn said.

There’s a lot more to augmenting interconnection besides capital costs, said Dan Rayburn, principal analyst at Frost and Sullivan. You can’t just flip a switch and open up a port and be done with it, he said. There are operation and maintenance costs associated with adding new traffic, and new infrastructure needed to bring traffic over the last-mile to the customer, he said. Is Cogent saying it'll pay monthly capital costs, Rayburn asked. Or is it just a one-time fee for hardware? “They're very good at wordsmithing,” he said.

Cogent didn’t ask for more peering until late 2013, when the ports were “already fully congested,” said Rayburn, who talks regularly with the ISPs. “Any good transit provider doesn’t come and ask when it’s already congested; they ask before it’s congested."

Columbia Professor Vishal Misra was sympathetic to Cogent’s arguments. Misra pointed us to a Wednesday blog post in which he argued ISPs have the confidence to “flex their muscles,” because of “less than perfect” competition that doesn’t ensure “good behavior” (http://bit.ly/1v5J0a8). Applying game theory, Misra and other researchers have found that the more competitors in a market, the less leverage each ISP has to extract payments from companies like Netflix. With four ISPs, it’s “plausible that it is not worth it at that point to play hardball and extract that revenue from Netflix,” because “instead the ISPs are more interested in winning and keeping customers,” Misra said. Creating congestion at peering points, “you can force the content providers, or the CDNs [content delivery networks] that they have, or the transit providers, to get into a paid peering arrangement, and that’s recurring revenue for AT&T or Comcast or whoever the ISP is,” Misra told us.

FCC Chairman Tom Wheeler has said interconnection is something separate from traditional net neutrality, which has focused on how ISPs treat traffic they send to customers along the last mile. “They absolutely need to be considered together,” Schaeffer said of last-mile and interconnection policies. Cogent’s in favor of bill-and-keep style rules applied to the Internet, which would mean free interconnection between networks, Schaeffer said. That free connectivity shouldn’t apply to content companies like Netflix, though, he said. “I do not fault, but do not agree, with Netflix’s request to get free connectivity,” Schaeffer said. “I just might go into a restaurant saying I'm hungry, I'd love somebody to give me a free meal if they will. That doesn’t make it right, and it doesn’t make it wrong for them to ask for it."

To AT&T’s Quinn, peering is not about net neutrality. “It has never been about net neutrality,” Quinn said. “It’s a red herring. It’s been a red herring from the start.”