Olimpiadi e Diritto Sportivo: online la registrazione dell’evento in collegamento dal Salone d’Onore del CONI
Si è tenuto martedì 8 Giugno l'evento organizzato dall’Università degli Studi Roma Tre in collaborazione…
Internet is composed of 54,000 “autonomous systems” or “networks” (ASs). These should not be confused with telco’s networks. ASs are built on top of telco’s physical networks. ASs complement each other. An isolated AS would resemble an intranet and would not allow a general access to information available on the internet. This means that ASs have an incentive to reach interconnection with other networks through peering or transit.
Peering & Transit
Peering means that two networks exchange traffic directly between each other without going through a third AS. Peering can be physically implemented through connecting two networks with a cable/fibre. Peering agreement can be:
There is transit, on the other hand, when a network buys connectivity from the rest of the internet. The network pays the capacity of the volume of traffic that can cross an interconnection (e.g. at an exchange point).
Study on IP Interconnection in the Netherlands
During the seminar, Jan Tichem – member of Chief Economist Team of the Netherlands regulatory and competition authority (ACM) – presented an analysis of IP Interconnection in the Netherlands. Following the 2014 Netflix vs. Comcast dispute in the US, the Dutch Ministry of Economic Affairs requested ACM to investigate the IP interconnection market in the Netherlands to determine:
ACM published its study in October 2015. The study is structured as follows:
Theories of harm
In this first theory of harm, an ISP may extract rents from the exploitation of a competitive bottleneck. The competitive bottleneck theory of harm was applied in ACM’s market analysis decision on mobile and fixed voice termination.
Applied to internet, the competitive bottleneck theory may exist when:
A possible scenario is that the ISP may exploit the situation by (i) refusing a settlement free peering, (ii) demanding a high settlement fee peering, or (iii) offering only partial access to its network.
The second theory of harm explored by ACM is that ISPs might use their market power on the “market for internet access” to foreclose the “market for content”.
Many ISPs offer both access services and content to end users. The idea is that vertically integrated ISPs may compete with CAPs by favouring their own content and hindering IP interconnection with other CAPs (e.g. ISP demands paid peering or congests interconnections). According to ACM findings, such a foreclosure does not occur in practice for the following reasons:
Not all restrictions are anticompetitive: possible efficiencies and justifications
Restrictive interconnection behaviour may in some circumstances be motivated by anticompetitive concerns. However, ACM notes that it is equally true that this behaviour can be motivated by pro-competitive concerns or otherwise legitimate reasons. From a commercial and economic perspective, the following efficiencies and objective justifications may apply to restrictive interconnection behaviour:
Difficulty to distinguish between “anti-competitive toll” and “fair bargaining”
ACM is aware of the difficulty to distinguish between “anti-competitive toll” and “fair bargaining” when peering deals are on the spot. However, as Jan Tichem pointed out: “even if the benefits of peering are unevenly distributed, peering is always an efficient solution when settlement-fee is not higher than savings on transit costs plus possible value of quality improvements”.
Experience of ACM at the time of the report (end 2015)
The likelihood of competition problems such as anti-competitive settlement fees or refusals to peer resulting in consumer harm is currently very low in the Netherlands. Paid peering is rare and the vast majority of peering arrangements are closed via a handshake. Even in cases where paid peering would have been more efficient, CAPs in the Netherlands reverted to transit access because they did not want to set a precedent by paying fees to a ISPs. According to interviewed CAPs, no degradation of quality due to IP interconnection conflicts was observed. Transit seems to be efficiently priced and there was sufficient transit capacity anyway.
Bargaining peering agreements might sometimes lead to temporary congestion, but parties seem to find the most efficient way of interconnection anyway. It is not clear if settlement fees sometimes paid by CAPs are too high. Competition law seems sufficient to address potential problems.
7 marzo 2017