The Geography behind the Internet Cloud - Peering, Transit and Access Issues

Abstract

In 1999, the Internet development varies considerably by geographic region. The network of networks is the most transforming invention and is developing at a far greater speed than any other technology of the 20th century. The Internet affects the way people do business, learn, play and work and TCP/IP is the protocol which defines the Internet. The levels of change are very different : social and cultural changes through increased networking, re-location of companies and new forms of businesses and organisations, restructuring of supply and demand chains and new working methods as well as reshaping of processes in retail and wholesale business. These changes influence the spatial structure due to the kind and geographic spread of access and connectivity to networks beside the location pattern of the Internet industry itself. The growth potentials of the Internet are mainly influenced by the availability and performance of physical network infrastructure. Since Internet Service Providers (ISPs) partially use the public-switched network, access to backbone network resources via leased lines, local access via unbundled local loops, co-location and interconnection are important to the growth of the information society. The key drivers for the development of telecommunications infrastructure for access to the Internet and global connectivity are to ensure competition and appropriate regulation of dominance to maximise the roll-out to rural geographic areas, to new subscribers and to ensure a reasonable quality of service while at the same time encouraging carriers to compete for those markets. This paper provides insight behind the Internet cloud and the regulatory environment which has a significant impact on the development and connectivity of places and thus spatial structures within regions and countries. It considers the broad infrastructural issues, the structure of the market and the role played by tele¬ communications operators and discusses the market dynamics of access and Internet interconnection. In order to understand market dynamics of the Internet industry and the spatial implications, issues of traffic flows and communication structures, recent backbone market changes and interconnection on the backbone as well as local level regarding peering and transit systems need to be observed. Pricing of leased lines and Internet access pricing as well as special access products offered by Incumbents to ISPs to connect their customers are important elements which define the different developments of the Internet throughout geographic regions. Considering costs of connectivity and access, localisation of traffic nodes and geography of investments in new IP infrastructure, space and distance remain important for the evolution of the Internet