[ppml] [narten at us.ibm.com: PI addressing in IPv6 advances in ARIN]

[Michael.Dillon at btradianz.com]

> (I'm not smart enough to figure out how the geotopo approach would 
> work without causing a return to the equivalent of the pre-1994 
> international telephony settlements regime, but that's my own lack of 
> imagination I suspect).

I'm not sure why you think that ISPs would give
up the current Internet settlement regime and move
back to a pre-1994 telephony settlement regime.

Back then, telephone companies counted every penny
of every single point-to-point flow that went across
their boundaries. Then they compared lists, counted
the totals and one party paid the difference to the
other party.

On today's Internet, settlements are all bilateral.
The two parties estimate the traffic balance between
them without actually accounting for every penny of
cost. Doing it this way, they both save the substantial
costs of counting pennies. Then, if the both agree
that they are more or less in balance, they peer 
with each other at no charge. Again, the cost savings
of not counting every packet, offsets the minor
fluctuations in traffic between the two companies.
However, if they estimate that there will be a traffic
imbalance between the two parties, then they agree 
on a fee to be paid for this imbalance. This is called
paid peering. 

The current settlements regime has evolved over many
years of operational and business experience. It is
unlikely to change substantially when geo-topo traffic
is introduced into the scheme. Of course, peers will
have to incorporate geo-topo traffic into their agreements
and into their engineering planning, but there is 
nothing to indicate that this will drive them to 
packet counting or any kind of large scale deployment
of IP accounting.

--Michael Dillon