Using Tuangou to Reduce IP Transit Costs

Abstract

A majority of ISPs (Internet Service Providers) support connectivity to the entire Internet by transiting their traffic via other providers. Although the transit prices per M bps decline steadily, the overall transit costs of these ISPs remain high or even increase, due to the traffic growth. The discontent of the ISPs with the high transit costs has yielded notable innovations such as peering, content distribution networks, multicast, and peer-to-peer localization. While the above solutions tackle the problem by reducing the transit traffic, this paper explores a novel approach that reduces the transit costs without altering the traffic. In the proposed CIPT (Cooperative IP Transit), multiple ISPs cooperate to jointly purchase IP (Internet Protocol) transit in bulk. The aggregate transit costs decrease due to the economies-of-scale effect of typical subadditive pricing as well as burstable billing: not all ISPs transit their peak traffic during the same period. To distribute the aggregate savings among the CIPT partners, we propose Shapley-value sharing of the CIPT transit costs. Using public data about IP traffic of 264 ISPs and transit prices, we quantitatively evaluate CIPT and show that significant savings can be achieved, both in relative and absolute terms. We also discuss the organizational embodiment, relationship with transit providers, traffic confidentiality, and other aspects of CIPT. Categories and Subject DescriptorsC.2.3 [Computer-communications networks]: Network operations; network management * Tuangou (pronounced "twangoo"), a term originating in China, loosely translates as team buying or group buying, http://en.wikipedia.org/wiki/Tuangou.

ENDEAVOUR: A Scalable SDN Architecture For Real-World IXPs

“…IXPs have grown in number [1] and size [14], carrying huge traffic volumes [5], and interconnect a multitude of networks [2], [3]. With about 80% of the address space reachable through IXPs [3], [15], [28] affect a large share of the Internet.…”

“…Nowadays, the largest IXPs interconnect hundreds of Autonomous Systems (ASes) and carry huge traffic volumes (even several Tbps) [2]. Around 80% of the announced address space is reachable through the existing IXPs [3] and their presence extends to the most remote regions [4], [5]. While IXPs have facilitated greater interconnectivity and affordability, many fundamental drawbacks in the Internet are rooted in the protocol enabling interdomain connectivity, i.e., the Border Gateway Protocol (BGP).…”

Volume-Based Transit Pricing: Is 95 the Right Percentile?

“…These IXPs publish MRTG graphs with 5-minute utilization (inbound and outbound) for each network connected to the public peering fabric of the IXP. We collected these graphs every day for the month of August 2013 and used Optical Character Recognition tools [3] to parse them. BIX had 62 networks connected to its public peering fabric, while SIX and ILAN had 48 and 55 networks, respectively.…”

“…Networks connect to IXPs to create (settlement-free) peering connections with other participating networks, and so the traffic statistics we see at an IXP are for a connected network's peering traffic 4 . Castro et al [3] showed that transit traffic and peering traffic have similar diurnal patterns and peak-to-valley ratios; in fact, the transit traffic for a network can be well-approximated as a multiplicative factor of the peering traffic. In our analysis we consider the IXP as proxy for a transit provider, and the networks connected to it as its customers.…”

Economics of traffic attraction by transit providers

“…Persistent declines in transit prices have recently put transit businesses under significant financial pressure. Furthermore, peering [1], [2], caching [3], joint purchase of transit in bulk [4], [5], and other cost-reduction techniques by customers tend to decrease revenues of transit providers.…”