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Bill Norton's Visit to New Zealand

Bill Norton's NZ Visit Report to INZ Council 4 March 2005

Compiled by Keith Davidson, Pete Macaulay and Jordan Carter

Keith Davidson (3rd to 6th February)

InternetNZ funded Bill Norton, co-founder and Chief Technical Liaison for Equinix (www.equinix.com) and world authority on peering, to attend the NZNOG conference in Hamilton on Thursday 3 and Friday 4 February 2005.

Bill gave a demonstration of his "Peering Simulation Game" to the conference, and also did a separate presentation titled "Asia Pacific Peering Ecosystems", which highlighted some of the diversity of approach to peering within the region. In each of the 5 ecosystems presented (Australia, Hong Kong, Singapore, China and ??) Bill had a full breakdown of the costs of transit, costs of peering, and the breakeven points in data handling for both - full economic models for these regions. I'd recommend anyone with an economic, commercial or policy interest in peering to keep an eye on the NZNOG website at www.nznog.org, as the presentation will be recorded there at some stage in the near future.

Also, later in the programme Bill participated as part of a panel discussion with Joe Abley, Andy Linton and Bill Woodcock (of PCH), on peering.

Certainly Bill Norton's low key and pragmatic approach was well received by attendees, and Bill was constantly surrounded by folk eager to discuss peering in greater detail.

Bill commented to me by email as follows: "I never had an audience shouting at the players before ! :-) That was as lively a game as I have ever seen. As I said before, I was expecting it to be merely interactive." It was interesting to see the gambit of human emotions and decision making tested in such a game, but I believe it genuinely reflects real-world attitudes to peering”.

After the NOG, I took Bill on a slow trip back to Wellington, stopping in Rotorua to enjoy some thermal sights and Maori culture, and more in Taupo etc, delivering Bill into our staff's care by Sunday night. During the course of these 2 days we discussed a wide range of interesting Internet topics. Bill seems to think that where successful peering has occurred, transit arrangements are now re-entering as viable alternatives - given the costs of transit have been driven down dramatically. These moves are generally visible in countries with a longer history of peering, and more factionalised dominant telcos than the NZ situation. Bill regards Australia and NZ as "aberrant" in terms of peering, Australia because of the strange ACCC ruling, and NZ due to the supreme dominance of a single telco combined with a Government apparently unwilling to regulate over.

I believe InternetNZ achieved a significant return on its "investment" in bringing Bill to New Zealand, and the broad exposure we were able to achieve. It is a great pity we were unable to facilitate a session with TelstraClear. It is, in my mind anyway, an even greater pity that we couldn't have arranged for Bruce Parkes from Telecom and Grant Forsyth from TelstraClear (or Teresa Gattung and Rosemary Howard) to participate in the Peering Game. It certainly is the most simple and fun way of getting right to the heart of the decision making processes when considering peering.

Jordan Carter

:: Trade Me ::

Bill Norton, Pete Macaulay and Jordan Carter met with Sam and Paul from TradeMe. As a large-scale content provider, they support peering. When TCNZ de-peered at WIX, they told their transport provider (AT&T) that they would not pay for domestic transit – as a result, AT&T provide free transit for such traffic. TradeMe will continue to advocate for peering and are using their position to encourage development of peering in the NZ internet.

:: Telecommunications Commissioner Douglas Webb ::

The Commissioner came to our offices with Tibor Gabanyi, a Commission analyst, and met with Bill Norton, Jordan Carter and Debbie Monahan. Mr. Webb went through Bill's business model (Equinix) for peering points, and explored the US regulatory model.

Douglas noted there are two approaches to regulation in this area – classic anti-trust regulation (which appears to be the US approach) versus a new approach based on the changes implied by telco transition to IP based voice networks. His question, broadly, could be summarized as follows: does peering in IP based networks present a bottleneck that will require regulation, in a way akin to the way interconnection on the PSTN is regulated? Not the same regulations, but potentially the same policy question.

He expressed an interest in "Equal Opportunity Peering" and seemed to regard the growth of VoIP as a conceivable future point of entry for regulation in the peering area – if required to guarantee quality similar to the PSTN.

It was encouraging to see the Commissioner interested in these issues. He is continuing to keep a watch on peering issues and invited InternetNZ to keep his staff in touch with progress we make on the issue.

:: Telecom NZ Ltd ::

Bill Norton and Jordan Carter met with a number of Telecom staff at their offices in Jervois Quay. Bill introduced himself and went through his standard presentation on the models of peering and the NZ ecosystem.

Some points to note:

  • Telecom’s view is that TCL is seeking to de-peer and that the two-tier model is the most likely outcome in NZ.
  • Telecom finds the legacy, informal relationships around peering problematic in the current commercial arena. Their direction is similar to TCL, if not their approach.
  • Bill outlined the story of how the .AU regulation of Tier 1 ISPs developed.
  • Telecom were interested in whether SLA/QoS issues arise in peering; Bill explained the largely mutual concern to make peering work properly by both players. Also wondered if the arrangements were informal or formalised - Bill explained usually the former, with no SLA type arrangements usually in place.

Telecom’s concerns seemed, understandably, to be ones imposed by commercial drivers.

Pete Macaulay

Bill attended a meeting hosted by MED, taking most of the morning of 7 Feb. It was particularly gratifying to have Reg Hammond present for the full meeting. Other attendees included John Emanuel of Azimuth, contracting to MED, Brian Johns and John Houlker. A broad ranging discussion around peering fundamentals and the use of peering for government provided Bill with an opportunity to express his views on how to make peering work for government in a commercial model. One of the views was that a true neutral peering point is needed in Wellington. Other concerns included the issue of off shore routing of government traffic, and the risk of the government ring fencing itself. An action item for InternetNZ is to discuss the plans for the government network with Laurence Millar. A further action is for InternetNZ to engage with SSC to create a case for government to insist on peering. It is felt that this type of meeting is productive and will help InternetNZ to drive policy in a low key manner.

Bill and Peter Macaulay flew to Auckland on the evening of the 7th. Apart from a casual review over breakfast, we did not arrange the expected meetings for that day as Bill was not well. He used our Auckland office as a base, before leaving NZ that evening.

Recommendations

1. That this report be accepted

2. That Council go into committee to discuss further aspects

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