[ih] History of the Economics of the Internet?

[Sebastian Moeller]

On July 31, 2026 1:49:21 AM GMT+02:00, "John R. Levine via Internet-history" <internet-history at elists.isoc.org> wrote:
>On Thu, 30 Jul 2026, Scott O. Bradner wrote:
>> it also touches on what the legacy telcos expect as to settlements etc
>
>Right, but that's telephone call settlements, not Internet data settlements.  Ineffiecnet little telcos like mine are sad not to get settlements.  I hear there are (maybe were) tiny phone co-ops in the midwest where not only is your phone line free, you get regular dividends paid from the settlements.
>
>My impression is that for Internet interconnections, if the two parties are of comparable size they peer, or if one is bigger, the smaller pays the larger for transit.  I've also heard of paid peering, somewhere in between but not common.

Besides the T1 ISPs that by definition require settlement free peerings between them (but see Brian's China example for where the definition seems to break down) I believe it most fruitful to think about the balance in motivation to move packets between the two entities. If that is sufficiently similar settlement free peering is likely, otherweise the party with less motivation will see to get paid by the other... btw, the directionality of the traffic is less important.


>
>R's,
>John
>
>>> On Jul 30, 2026, at 4:48 PM, John Levine <johnl at iecc.com> wrote:
>>> 
>>> It appears that Scott Bradner via Internet-history <sob at sobco.com> said:
>>>> this covers some of the current discussions over the Internet's economic model
>>>> within the regulatory world (at least in the US)
>>>> 
>>>> https://isoclive.substack.com/p/fcc-ip-transition
>>> 
>>> Not really. It's about moving the telephone system from legacy SS7 to IP
>>> signalling, switching, and transport. It's the same technology as the Internet
>>> but it's separate dedicated IP networks with privately negotiated
>>> interconnections and occasionally still per-minute settlements.
>>> 
>>> There is also telephony that runs "over the top" of the public Internet, but
>>> that's something else. That's VoIP, Voice over IP, while the former is VuIP,
>>> Voice using IP. There are plenty of vendors that provide VoIP to VuIP gateways
>>> so your VoIP terminals can make and receive calls to or from real phone numbers.

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