Internet convergence in action: is best effort internet already gone? Lessons from Norway

There has been huge debate on whether the internet should remain as a network that does not differentiate between “levels” of content providers—something that is known as the Best Effort internet. Based on data from Norway, Hanne-Stine Hallingby, Silvia Elaluf-Calderwood and Gjermund Hartviksen suggest that we may be already in the presence of a new type of internet

Convergence in action: a case study of the Norwegian internet

The conceptual framework for understanding the logical Internet is based on the construction of a horizontal, layered architecture, which differentiates between physical-, data link-, network-, transport-, and application layers (1). This is different from the telecommunication networks model where a new service traditionally used to require a new network architecture to be established (2). However, the digitalization of services and products offered over the telecom infrastructure allows us to observe an emergent phenomenon of increased vertical integration on the Internet as well as the creation of further service specialization opportunities for telecom operators and users (3). We propose in this paper that this development and change in the way services are provided, leads to a new type of Internet - an addition to the current best effort Internet. This paper presents the case study of the Internet in Norway, analysing 166 of the approximately 40.000 independent AS numbers registered worldwide as catering for end-to-end services. The paper categorizes the Norwegian AS numbers according to size and type of services. Through our analyses two major groups of actors can be identified, each of them seeking to gain strategic advantage from the current Internet traffic growth: 1) Content providers and hosts seek to have a highly reliable network access with a minimal set of traffic or transmission costs. One action is to acquire AS numbers and use settlement-free peering agreements for distribution of their traffic, which is possible in traffic exchange regimes rooted in symmetry, slowly becoming asymmetric; 2) Internet access providers (IAPs) seek to take control over incoming traffic growth by hosting content within their own network and thereby to rebalance traffic and create new revenue streams with content hosting and premium end-to-end connection on-net. Our findings support the hypothesis that Internet is becoming both more vertically integrated and converged, and more specialized or modularized (4)

Regulatory policies in relation to metrics and data collection for measuring the emergent Internet

The Internet is currently undergoing a major process of change and transformation. It is moving away from a basic model of layered architecture to a modular architecture with integrated provisioning of digital services and products to users (Garud, Kumaraswamy et al. 2003; Clark 2004; Fransman, 2010 and Yoo 2010). Furthermore traffic volumes and asymmetry of traffic information available for analysis makes it difficult to gain a full overview of and understand these changes (Hallingby et al, 2012 and Liebenau et al, 2012). Hence studying Internet as a whole is difficult, and there are many issues with data collection, with the academic and commercial literature providing plenty of references to such problems. The analysis is made even more complicated when trying to address medium and long-term sustainability of the telecom and Internet industries (Yoo, 2012). Value creation and capturing is a growing challenge to Internet ecosystem stakeholders, seeking to re-innovate a sustainable system. Hence the emergent Internet also changes the actions of national and regional regulators. Regulators are normative acting on behalf of consumers and ensuring adequate investments in society critical infrastructure (FCC, 2011). Their goals are to provide mediation using competition laws and rules as the recent French case Cogent vs. France Telecom shows (ARCEP, 2012b). This is particularly due to fast convergence of Internet and telecom. The transforming state of Internet has led many regulators around the world to make efforts to collect data for such regulatory purposes but with variable degree of success. Thus measuring Internet remains a huge challenge, and we will suggest some ways forward in this paper. Norway is a relatively small country “in the world of the emergent Internet” (Hallingby and Erdal, 2011). However the size and other aspects of the Nordic culture (e.g. openness to accountability, sense of community at all levels of society, etc.) have created an environment in which the national regulator (NPT) has multiple sources of data (NPT, 2012b), and also with correlated Internet data that are collected by diverse institutions. This has resulted in a clear and well explained ability to describe the Norwegian Internet (Hallingby and Erdal, 2011). There is also a culture of regulatory pro-active engagement with changes to the earliest emerging of issues e.g. CDNs legal forms (NPT, 2012a). This article discusses possible type of metrics required to explain the link between Internet network measures and Internet economic variables. First of all we are describing the emerging Internet in Norway, also indicating a more generic change supporting the modularity observed elsewhere. Second, and more important for the purpose of this article, we believe the metrics displayed are very valuable to companies, users, regulators and any other stakeholders. Specifically, we show the case of Norway as an example of the type of knowledge that may be developed, how these mappings can be performed, the scope and limitations of such methodology, and how it can be used by regulatory authorities to monitor but not obstruct the development of business activities. Finally, we also review the usefulness of this type of measurement in the context of a recent regulatory analysis of CDNs in Norway

Convergence in action: A case study of the Norwegian Internet

The conceptual framework for understanding the logical Internet is based on the construction of a horizontal, layered architecture, which differentiates between physical-, data link-, network-, transport-, and application layers (Woodard and Baldwin, 2008). This is different from the telecommunication networks model where a new service traditionally used to require new network architecture to be established (Yoo, 2012). However, the digitalization of services and products offered over the telecom infrastructure allows us to observe an emergent phenomenon of increased vertical integration on the Internet as well as the creation of further service specialization opportunities for telecom operators and users (Liebenau et al., 2011). We propose in this paper that this development and change in the way services are provided, leads to a new type of Internet – an addition to the current best effort Internet. We illustrate our proposition by presenting the case study of the Internet in Norway, analysing 166 of the approximately 40.000 independent AS numbers registered worldwide as catering for end-to-end services. The paper categorizes the Norwegian AS numbers according to size and type of services. Through our analyses two major groups of actors can be identified, each of them seeking to gain strategic advantage from the current Internet traffic growth: (1) Content providers and hosts seek to have a highly reliable network access with a minimal set of traffic or transmission costs. One action is to acquire AS numbers and use settlement-free peering agreements for distribution of their traffic, which is possible in traffic exchange regimes rooted in symmetry, slowly becoming asymmetric; (2) Internet access providers (IAPs) seek to take control over incoming traffic growth by hosting content within their own network and thereby to rebalance traffic and create new revenue streams with content hosting and premium end-to-end connection on-net. Our findings support the hypothesis that Internet is becoming both more vertically integrated and converged, and more specialized or modularized (Clark et al., 2004)