Delving Into The Series Of Tubes: How Internet Backhaul Works And Why We Need More

The issue here is not just the traditional challenge of establishing IXPs in countries where they do not currently exist, though that remains a priority. These commentators expect a need for a significant increase in the number of IXPs, in the next decade, from the current 20 major locations to a future with 200 such locations. The basis for this assessment is the increased use of fixed and wireless broadband access throughout the world. A significant proportion of the users of these connections are in countries and regions that are under served. Much of their traffic will be sourced or routed from outside their region if IXPs are not available for content and services providers to further localise this traffic. This results in higher costs for transit. How the internet economy works The OECD did a nice job explaining in 2012 the importance of internet exchange points to the cost of transit, showing how places with more IXPs saw lower prices for transit and in effect became broadband exporters. Europe has moved to this model, while the U.S. has a slightly different for-profit IXP model that may be transitioning over to the more cooperative European model, thanks to the Open Internet Exchange organization . But IXPs are only part of the problem. First, a bit about backhaul. The internet is a series of networks that connect to each other at interconnection points located in data centers. Your ISP provides whats known as last-mile service, which goes from a business or home back to a central office or head end owned by the ISP. At that point, your traffic heads out to a transit provider that connects to networks owned by content companies, retailers and clouds. If the traffic needs to cross the ocean, it will travel on submarine cables . These transit providers long-haul and middle-mile networks, as well as the submarine cables, are all examples of backhaul how last-mile traffic gets back to the internet itself. The report concerns itself mainly with submarine cables, though. Telegeographys submarine cable map. Many developing areas need more pipes connecting them to other parts of the world. This is both an economic issue (more competition between pipe owners lowers prices) as well as a resiliency issue (more pipes ensure that cable cuts will not shut down the communications network ). Not only do these areas need more submarine cables, but the ownership structure is changing, with big internet companies like Google and Facebook investing in backhaul at the submarine cable level as well as long haul fiber across countries. Building an economic argument for openness The OECD report lays out a detailed history of how liberalization and increased competition on the submarine cable side can lower prices and boost demand for internet-based services. In fact, the biggest takeaway from the OECD report which should resonate with all internet stakeholders, from the ISPs to the content guys is that the more open the system is in terms of access and peering, the more demand there is for these networks.
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