Internet Peering as a Network of Relations

Steffen Lippert and Giancarlo Spagnolo

Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems from Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich

Abstract: We apply results from recent theoretical work on networks of relations to analyze optimal peering strategies for asymmetric ISPs. It is shown that - from a network of relations perspective – ISPs’ asymmetry in bilateral peering agreements need not be a problem, since when these form a closed network, asymmetries are pooled and information transmission is faster. Both these effects reduce the incentives for opportunism in general, and interconnection quality degradation in particular. We also explain why bilateral monetary transfers between asymmetric ISPs (Bilateral Paid Peering), though potentially good for bilateral peering, may have rather negative effects on the sustainability of the overall peering network.

Date: 2006-11
New Economics Papers: this item is included in nep-mic, nep-net and nep-soc
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Citations: View citations in EconPapers (1)

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Journal Article: Internet peering as a network of relations (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:trf:wpaper:191

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