(No.159) Strategies for expanding IXPs and other Internet/cloud infrastructure

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Workshop Theme: 
Managing Critical Internet Resources
Theme Question: 

Managing Critical Infrastructure Question 1: What is the role and importance of IXPs in localizing content, including ensuring easier connectivity in cases of disasters?

Concise Description of Workshop: 

Infrastructure investment and deployment is a prerequisite to enabling the social and economic benefits of the Internet and cloud services. This underlying infrastructure includes communications networks, DNS servers and Internet Exchange Points (IXPs). While much progress has been made, there continue to be challenges in continuing the expansion of infrastructure in terms of reach and capabilities.
The workshop will explore infrastructure deployment from a range of perspectives and highlight successful case studies and strategies for expanding Internet and cloud infrastructure, with a particular focus on emerging markets.
Workshop Agenda

  1.  Overview of the progress that has been made in deploying IXPs and other Internet infrastructure worldwide, and discussision of the challenges and gaps that remain (e.g.,economic and technical barriers to continued infrastructure expansion). 
  2. Real-world experiences deploying IXPs in areas such as Kenya, Nigeria and Nepal, including lessons learned. We also will discuss APNIC experience expanding the availability of Anycast DNS servers.
  3. Technical, economic and policy strategies for promoting the deployment of Internet infrastructure and establishing a sustainable market.  Discussion will include demand-side strategies, such as local content creation and innovation hubs, as well as government policy strategies for promoting investment.
  4. Economic and social benefits of expanded infrastructure deployment. We will discuss lessons learned and potential challenges to maximizing the economic and social benefits of infrastructure deployment. 
  5. Internet governance implications and opportunities for greater global coordination and cooperation.  Discussion of how to build on the experiences of past success stories.
  6. Interactive discussion with the audience.


Organiser(s) Name: 

Jeff Brueggeman - AT&T - Business
Paul Wilson - APNIC - Internet Operator
Karen Rose - ISOC - Multistakeholder Organization

Previous Workshop(s): 

APNIC and ISOC have organized various IGF workshops.  This is the first workshop that AT&T has helped to co-organize.

Submitted Workshop Panelists: 

• Dr. Bitange Ndemo, Permanent Secretary in the Ministry of Information and Communications, Government of Kenya • Michael Kende, Partner, Analysys Mason Group (Switzerland) (Confirmed) • Fiona Asonga, CEO, Telecommunications Service Providers Association of Kenya/Kenya Internet Exchange Point (Confirmed) • Jimson Olufuye, CEO, KontemporaryTM (Nigeria) (Confirmed) • Karen Rose, Sr. Director of Strategic Planning and Business Development, ISOC (Confirmed) • Guarab Upadhaya, Sr. Technical Director, Limelight (Singapore) • Bill Woodcock, Research Director, Packet Clearing House (Confirmed) • Paul Wilson, Director-General, APNIC (Confirmed) 

Name of Remote Moderator(s): 
Claudia Selli, AT&T
Gender Report Card
Please estimate the overall number of women participants present at the session: 
About half of the participants were women
To what extent did the session discuss gender equality and/or women's empowerment?: 
It was not seen as related to the session theme and was not raised
Please include any comments or recommendations you have on how to improve the inclusion of issues related to gender equality and: 

An important aspect of gender equality is ensuring that women have an opportunity to fully participate in the IGF as business and technical experts.  A concerted effort should be made to include women with applicable business and technical expertise on all types of IGF workshops and discussions.

Reported by: 
Jeff Brueggeman
A brief substantive summary and the main issues that were raised: 

The workshop explored infrastructure deployment from a range of perspectives and highlighted successful case studies and strategies for expanding Internet and cloud infrastructure, with a particular focus on emerging markets.
The workshop was moderated by Karen Rose, Sr. Director of Strategic Development and Business Planning, ISOC
The panelists were:
Michael Kende, Partner, Analysys Mason Group (Switzerland)
Fiona Asonga, CEO, Telecommunications Service Providers Association of Kenya/Kenya Internet Exchange Point
Bill Woodcock, Research Director, Packet Clearing House
Paul Wilson, Director-General, APNIC
Martin Levy, Director of IPv6 Strategy, Hurricane Electric
Karen Rose introduced the workshop and the panel of experts.  She described the goal of the workshop discussion as progressing beyond the technical issues associated with the deployment of Internet Exchange Points (IXPs), which had been addressed in prior IGF workshops.  She noted previous IGF workshops on IXP issues had produced significant outcomes.  Among these included connecting together those looking for how to establish IXPs with those willing to help, and spurring partnerships and collaborations that helped local communities to build technical capacity and set up IXPs.  Karen noted that this should be considered a success of the IGF’s multi-stakeholder process.  She further explained that this panel would extend that work, and in particular, the discussion would encompass issues such as the remaining infrastructure gaps, the economic impact of IXPs and the legal/policy environment that is needed to promote further infrastructure investment.
Michael Kende summarized recent economic papers he has published on the evolution of Internet traffic arrangements and the growth of Internet Exchange Points (IXPs).  These recent papers, talking about the benefits of an IXP in terms of reducing “tromboning” (transiting traffic to distant IXPs and back again), lowering costs, developing a regional IXP, and increasing revenues from more content use that can be locally accessed.  The challenges include having the incumbent join, and getting the infrastructure to bring capacity into the country and between ISPs and across borders.
Bill Woodcock discussed the importance of IXPs as bandwidth producers.  He noted how AMS-IX is one of the greatest producers in absolute terms, because it creates much more traffic than the Netherlands consumes, in comparison to Germany where consumption and production is more balanced.  At the same time, the fastest growth is coming from the newer IXPs that have relatively low amounts of traffic, in Latin America and Africa.  He noted that most growth now is in the Caribbean, which clearly was tired of ‘exporting’ money to the US and the UK by buying capacity to those countries, while the least growth is in the Middle East where the expenditure is considered negligible.  Finally he spoke about the recent paper he published with Dennis Weller showing that most commercial agreements facilitating the exchange of Internet are not even written on paper.  He observed that government regulation would not produce similar results.
Fiona Asonga spoke about the growth of the Kenya IXPs (KIXP), which now has 38 members.  They have been able to expand, so there is now redundant exchange in Nairobi and an exchange in Mombasa to take advantage of the undersea cable.  The exchange provides value-added services for operators, such as network measurement tools and security services.  In addition, the exchange has worked with Google and Akamai to cache content locally, and with local content providers to host Internet content.  Fiona described the benefits that have resulted from lower costs, latency, government use of the exchange for e-government services (through the Kenya Revenue Authority), and more regional traffic.  The ongoing challenges in Kenya are infrastructure deployment, especially in rural areas and with respect to regional backhaul.
Paul Wilson discussed how ISPs compete in retail markets, but must collaborate in technical terms to peer and create the network.  He gave a figure of $20,000 to set up the new exchange in Nepal and how the start can be very low tech.  He also noted that APIX has recently emerged to exchange information, and that one of the large intangible benefits of an IXP was community building and understanding of the ecosystem and the interconnections of the companies.  Paul noted that the best ecosystem needs low barriers, such as no telecom-style licensing and few bureaucratic hurdles, in order to deliver low cost of using the IXP to promote usage and to end tromboning, which should be more expensive than using the IXP.  He sees an opportunity for IXPs to help facilitate the development of CDN and cloud services.  Paul also noted that the non-profit association model for IXPs, where members and participants work together to establish and manage the exchange, has been highly successful around the world.  He added that human factors, including as the willingness of prospective participants to collaborate, are more determinative of IXPs success than technical issues.
Finally, Martin Levy presented the viewpoint of an infrastructure provider deciding to invest in a country.  He noted the positive impact of the IXP on the expertise of the local engineers and requirement that cooperate in creating the peering, and in so doing also gain expertise in buying capacity domestically and internationally.  Further, the IXP will lead to the development of a better data center than otherwise needed for just serving the local IT industry.  He indicated that countries that have strong growth of bandwidth and infrastructure, including data centers, are the same countries that have well functioning IXPs.  Martin said that when global network operators are considering where to next expand to next, the presence of an IXP provides an incentive and is a good indicator of a country’s potential for market growth.
The questions and discussion with the audience focused on the challenges for landlocked countries, and incenting incumbent providers to join an IXP in getting an incumbent to join in an environment without regulation.  Questions from the audience also prompted a discussion of whether it was useful to connect IXPs together in an attempt to foster greater connectivity.  Bill Woodcock explained that this model has not been successful, and can actually add costs and create bottlenecks.  Fiona Asonga noted that some governments have been encouraging IXPs to interconnect and have even offered to provide subsidized links.  She noted, however, that consistent with Bill’s comments, operators in the region find more value in connecting directly to different IXPs rather than through a link between IXPs.   

Conclusions and further comments: 

The workshop discussion identified a range of tangible and intangible benefits of deploying IXPs.  The tangible benefits include additional bandwidth and lower costs, but also improved quality of service and more capabilities to host local content in a country.  The intangible benefits include building expertise and a community of stakeholders to collaborate on building and maintaining Internet infrastructure.  These broader benefits should be explored further in future discussions.  A necessary pre-condition for these positive impacts are government policies that open markets to competition and international gateways, and that promote investment and innovation in new content and services.