-----BEGIN PGP SIGNED MESSAGE----- Hash: SHA1 On 24/09/2012 10:31, Sam Russell wrote:
That's a good point.
Didn't the old "free dialup internet" plans come about as a way to deal with SPNP? The version I heard was that Clear had to pay lots to Telecom because more calls went from Clear to Telecom than the other way, so getting Telecom customers to dial into Clear (and it was dodgy so you'd have to dial up when it dropped out every half hour or do) meant Clear could get money back from Telecom.
If telcos had done settlement free peering instead of this rent-seeking SPNP that's designed to squash out smaller players, then smaller players wouldn't have to resort to such contrived tactics to stay afloat, and could focus on providing better value to their paying customers
I'm sure others who were around at the time will correct any mistakes, but the way that the likes of i4free and zfree came about was that Telecom charged Clear a lot more for interconnect termination than they were prepared to pay for the reverse. The volume of minutes was irrelevant, Telecom maintained that their vastly-larger customer base entitled them to this monopoly rent because it was more valuable to Clear customers to be permitted to call into Telecom's network than vice versa. However, because dialup internet calls tend to be for very long periods of time the per-minute nature of interconnect charging meant that if Clear could be the destination for a whole lot of Telecom landline customers' internet calls they would make money out of interconnect. So they got other ISPs to use Clear ISDN tails, meaning the calls were terminated into Clear's PSTN network for interconnection purposes, and gave the ISPs a cut (or, in the case of zfree, kept it all). Voila i4free, followed shortly thereafter by 0867. The whole debacle came about because Telecom were allowed to get away with being a predatory monopoly courtesy of a non-existent regulatory environment, so there was zero chance that settlement-free peering would've happened. That Telecom got away with introducing 0867 as a way of terminating the market for interconnection arbitrage demonstrates how impossible it would've been for any kind of market-neutral system to have developed. - -- Matthew Poole "Don't use force. Get a bigger hammer." -----BEGIN PGP SIGNATURE----- Version: GnuPG v2.0.17 (MingW32) Comment: Using GnuPG with Mozilla - http://www.enigmail.net/ iEYEARECAAYFAlBfj84ACgkQTdEtTmUCdpx2IQCfQtydz5C623RTv8vDpxCP58Kl tQUAnjZhdPPrHlJZ6gf60OdUVzUCJd02 =ukbZ -----END PGP SIGNATURE-----