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1. Analysis of the Requirements of Settlement-Free Interconnection Policies

   https://doi.org/10.1109/TNSM.2023.3254367  

   Nikkhah, Ali; Jordan, Scott (January 2023, IEEE Transactions on Network and Service Management)

   Peering between two networks may be either settlement-free or paid. In order to qualify for settlement-free peering, large Internet Service Providers (ISPs) require that peers meet certain requirements. However, the academic literature has not yet shown the relationship between these settlement-free peering requirements and the value to each interconnecting network. We develop two models to analyze the value to each network from the most common and important requirements in the United States. Large ISPs in the U.S. often require potential settlement-free peers to interconnect at a minimum of 6-8 locations. We find that there is a substantial benefit from this requirement to the ISP, but little incremental benefit from a larger number of interconnection points. Large ISPs often require that the ratio of incoming traffic to outgoing traffic remain below approximately 2:1. In the case of two interconnecting ISPs, we find that this requirement ensures a roughly equal exchange of value. We also show that it is rational for an ISP to agree to settlement-free peering if the content provider agrees to interconnect at a specified minimum number of interconnection points and to deliver a specified minimum proportion of traffic locally, but a limit on the traffic ratio is irrational. 

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2. Are the Settlement-Free Peering Policy Requirements for ISPs and CDNs Based on Network Costs?

   https://doi.org/10.2139/ssrn.4178682  

   Nikkhah, Ali; Jordan, Scott (August 2022, TPRC (the Research Conference on Communications, Information, and Internet Policy))

   Peering is an interconnection arrangement between two networks for the purpose of exchanging traffic between these networks and their customers. Two networks will agree to settlement-free peering if this arrangement is superior for both parties compared to alternative arrangements including paid peering or transit. The conventional wisdom is that two networks agree to settlement-free peering if they receive an approximately equal value from the arrangement. Historically, settlement-free peering was only common amongst tier-1 networks, and these networks commonly require peering at a minimum specified number of interconnection points and only when the traffic ratio is within specified bounds. However, the academic literature does not explain how these requirements relate to the value to each network. More recently, settlement-free peering and paid peering have become common between ISPs and CDNs. In this paper, we construct a network cost model to understand the rationality of common requirements on the number of interconnection points and traffic ratio. We also wish to understand if it is rational to apply these requirements to interconnection between an ISP and a CDN. We construct a model of ISP traffic-sensitive network costs. We consider an ISP that offers service across the US. We parameterize the model using statistics about the population and locations of people in the contiguous US. We consider peering at the locations of the largest interconnection points in the US. We model traffic-sensitive network costs in the ISP’s backbone network, middle-mile networks, and access networks. These costs are thus functions of routing policies, distances, and traffic volumes. To qualify for settlement-free peering, large ISPs commonly require peering at a minimum of 4 to 8 mutually agreeable interconnection points. The academic literature provides little insight into this requirement or how it is related to cost. We show that the traffic-sensitive network cost decreases as the number of interconnection points increases, but with decreasing returns. The requirement to peer at 4 to 8 interconnection points is thus rational, and requiring interconnection at more than 8 points is of little value. Another common requirement is that the ratio of downstream to upstream traffic not exceed 2:1. This is commonly understood to relate to approximately equal value, but the academic literature does not explain why. We show that when downstream traffic exceeds upstream traffic, an ISP gains less from settlement-free peering, and that when the traffic ratio exceeds 2:1 an ISP is likely to perceive insufficient value. Finally, we turn to interconnection between an ISP and a CDN. Large ISPs often assert that CDNs should meet the same requirements on the number of interconnection points and traffic ratio to qualify for settlement-free peering. We show that if the CDN delivers traffic to the ISP locally, then a requirement to interconnect at a minimum number of interconnection points is rational, but a limit on the traffic ratio is not rational. We also show that if the CDN delivers traffic using hot potato routing, the ISP is unlikely to perceive sufficient value to offer settlement-free peering. 

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3. Requirements of Settlement-Free Peering Policies

   https://doi.org/10.1109/GLOBECOM48099.2022.10000611  

   Nikkhah, Ali; Jordan, Scott (December 2022, IEEE)

   Peering between two networks may be either settlement-free or paid. In order to qualify for settlement-free peering, large Internet Service Providers (ISPs) require that peers meet certain requirements. It is widely perceived that these requirements represent the conditions under which the two peering networks perceive a roughly equal exchange of value. However, the academic literature has not yet shown the relationship between these settlement-free peering requirements and the value to each interconnecting network. We analyze the value to each network from the most common and important requirements. Large ISPs often require potential settlement-free peers to interconnect at a minimum of 6-8 locations from a predetermined list. We find that there is a substantial benefit from this requirement to the ISP, but little incremental benefit from a larger number of interconnection points. Large ISPs often require that the ratio of incoming traffic to outgoing traffic remain below approximately 2:1. We find that this requirement ensures a roughly equal exchange of value. 

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4. How Can Equitable Peering be Achieved Between ISPs and Content Providers?

   https://doi.org/10.1109/ICCCN58024.2023.10230173  

   Nikkhah, Ali; Jordan, Scott (July 2023, IEEE)

   Disagreements between Internet Service Providers (ISPs) and content providers over peering fees have risen to the level of potential government regulation. ISPs assert that content providers should pay peering fees based on the volume of downstream traffic. Content providers assert that consumers pay ISPs to transmit the content they request, and thus peering agreements should be settlement-free. We determine the fair peering fee between an ISP and a transit provider or content provider. We first consider cost sharing between an ISP and a transit provider. We derive the peering fee that equalizes their net backbone transportation costs. We illustrate how the peering fee depends on the traffic ratio and the amount of localization of that content. We then derive the peering fee between an ISP and a content provider that results in the same net cost to the ISP, and illustrate how the peering fee depends on the number of interconnection points and the amount of localization. We use these results to dispense with the ISP argument that they should be paid regardless of the amount of localization of content. 

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5. Towards Equitable Peering: A Proposal for a Fair Peering Fee Between ISPs and Content Providers

   Nikkhah, Ali; Jordan, Scott (December 2023, IEEE Transactions on Network and Service Management)

   Disagreements over peering fees have risen to the level of potential government regulation. ISPs assert that content providers should pay them based on the volume of downstream traffic. Transit providers and content providers assert that consumers have already paid ISPs to transmit the content they request and that peering agreements should be settlement-free. Our goal is to determine the fair payment between an ISP and an interconnecting network. We consider fair cost sharing between two Tier-1 ISPs, and derive the peering fee that equalizes their net backbone transportation costs. We then consider fair cost sharing between an ISP and a transit provider. We derive the peering fee that equalizes their net backbone transportation costs, and illustrate how it depends on the traffic ratio and the amount of localization of that content. Finally, we consider the fair peering fee between an ISP and a content provider. We derive the peering fee that results in the same net cost to the ISP, and illustrate how the peering fee depends on the number of interconnection points and the amount of localization of that content. We dispense with the ISP argument that it should be paid regardless of the amount of localization of content. 

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