With transit well below $1/Mbps in some places, why bother with peering?
The financial argument is tougher to make these days until you get up to pushing a ton of traffic. However, the traffic always grows up and to the right, so there is still a chance that rapidly growing traffic pushers will catch up to the curve.
Remote peering helps make peering financially rational. By removing some of the costs (router, colo) yet still providing direct adjacencies, remote peering into many locations can be a rational transitional strategy towards establishing a physical presence in the market.
So peering may reduce costs, but that is not the strongest motivation for peering for most. Then, why peer?
Peering improves performance, security, and maybe cost
In the Peering 2.0 world, the answer to the “Why Peer?” question is performance and security.
In many regions, and in all populated colocation centers, Internet Transit is a bargain these days, and a perfectly fine choice for your Internet traffic. But not for all of it. I assert that your Internet traffic is not equally valuable. When the large scale (n*100Gbps) Distributed Denial of Service (DDoS) attacks are launched against any target, the Internet becomes the wild wild west, unstable and congested along certain paths. You will never know whether your packets will make it to the final destination once they pass your network boundary. DDos is an equal opportunity killer - all packets along the affected path are subject to drops.
Important traffic is Peered
I really like Andreas Sturm’s phrase “Important traffic is peered.”
Any enterprise, content provider, portal, etc. should identify what traffic they really care about, and find a way to *directly* connect to those destinations. That way, they can make sure that this traffic bypasses the Internet transit service(s) and directly connects to the mission critical destinations.
For example, portals should be directly connected to their ad networks for example - there is money at stake here and this revenue should not be lost just because the Internet is having a bad day.
My e-commerce clients tell me that the traffic to and from partners (e.g. eBay, PayPal, DoubleClick, Visa, etc.) is most important, so these sites should be directly interconnected. If network reachability is financially strategic, this means that network performance leads to more sales and more revenue, and therefore critical to the company’s success.
Peering Improves Performance
In all of these cases, the important network services will perform better when directly interconnected.
The Priceline presentation at EPF in Croatia demonstrated a direct correlation between peered traffic and lower latency. This was across millions of page views. Lower latency means few abandoned carts, more transactions, fewer network problems to deal with.
LinkedIn shared similar data at the Peer 2.0 conference a few months later. In both cases, they shared that the connectivity to the directly connected destinations provided lower latency and was more stable. This is a pretty compelling case for peering.
“...connectivity to the directly connected destinations provided lower latency and was more stable.”
Peering improves Internet security
I already presented the case that “Peering Improves Security” and most everyone buys into the white paper.
In a nutshell, Peering Improves Security because
Peered traffic is architecturally separated from the commodity Internet where the side effects of DDoS attack impact all traffic that traverses its path,
Peered traffic has a smaller attack surface, because there are fewer network elements between source and destination, and
Peering leads to swifter resolution to network issues.
By metaphor, imagine the front door to your business is adversely affected by others. Kids are having large scale egg fights in the streets, making the streets difficult to navigate, and the USPS driver can’t make it to your house every day.
In this scenario, you will be better off if you also have an alley service entrance in the back of your house for deliveries. Your operation can continue on unaffected, even with the chaos in the streets. Don’t wait until a crisis to find out which or your critical services should be directly connected.
How the Cloud affects your traffic profile
I ran tcpdump on my computer and was surprised to find just how much traffic was going to and coming from Amazon Web Services and Google Cloud. I wasn’t using AWS directly, but many of my favorite network services host on AWS. If these services are critical to the business, then the business should be directly connected to AWS.
One of my clients ran into this problem struggling to meet a deadline. Their intermittent network issues were slowing their access to applications like Office 365 and storage solutions like dropbox and box. Very frustrating! This productivity loss can be mitigated architecturally with a few strategic direct interconnections.
Dr Peering Recommendation: Buy transit and peer.
When commodity Internet traffic is suffering even a modest 1-2% packet loss, the impact on your business can be significant. The network throughput drops, TCP windows get reduced by half, and if your company depends on network connectivity, this can bring your company to its knees. By all means, take advantage of great transit pricing if it exists, but directly connect to your important traffic destinations.
In my opinion, this is the strongest case today for Internet Peering.
I hope this helps -