Search:  

 
 
   News
newer
Cogent/Level3 Still Squabbling
Light Reading: 'Internet Peering: On Thin Ice?'
(old news - 12:43PM Friday Oct 14 2005)
tags: business · networking
Light Reading looks back at last week's conflict between Cogent and Level 3, and explores how likely it is for the same problem to occur again. Brimming with yet more soundbytes and finger pointing from executives on both sides, the piece opines that Congress and the FCC would only act to enforce peering agreements if such problems became commonplace.

Related:
  1. Time Warner Still Pretending Core, Last Mile Fiber The Same
  2. VPN 4 Life: More Anonymity Snake Oil?
  3. AT&T's 2G Customers See A Downgrade
  4. New Comcast Throttling System 100% Online
  5. DOCSIS 3.0 Gets Faster
  6. VPN4Life is a Scam
  7. Rumor: Google Cooking Up Own Router
  8. Verizon's Open Development Initiative? So Far It's A Joke
Forums » Cogent/Level3 Still Squabbling
view: topics flat text 
Post a:

Cheese
Premium
join:2003-10-26
Naples, FL
clubs:

Just pay

If you owe money, pay it, you dont pay, you get cut off. It's that simple.

ATLJ
Go Braves
Premium
join:1999-12-24
Atlanta, GA
clubs:

Re: Just pay

I think the issue is that Level 3 has a nice fat profit margin on their links and they don't want to lower it. Cogent is forcing them to lower it in some major markets so they can compete and L3 is pissed off about it so they figure we will try and force Cogent to raise prices by cutting the peering for a few days.

--
Tron: There are! I say there are so many amendments in the constitution of the United States of Americaaaa! I can only choose one! I can only choose ooooooone! I plead the fif! I plead the fif! FIVE! 1,2,3,4, fiiiif! Anything you say! FIIIF!
TheGhost
Premium
join:2003-01-03
Lake Forest, IL
clubs:

Re: Just pay

said by ATLJ See Profile :

I think the issue is that Level 3 has a nice fat profit margin on their links and they don't want to lower it. Cogent is forcing them to lower it in some major markets so they can compete and L3 is pissed off about it so they figure we will try and force Cogent to raise prices by cutting the peering for a few days.
How can Congent force them. From what I have read, there was an agreement, it wasn't being kept up from Congent's side, so Level3 cut them off per the contract. Seems like a straight forward case.

ATLJ
Go Braves
Premium
join:1999-12-24
Atlanta, GA
clubs:


edit:
October 14th, @04:45PM

Re: Just pay

said by TheGhost See Profile How can Congent force them. From what I have read, there was an agreement, it wasn't being kept up from Congent's side, so Level3 cut them off per the contract. Seems like a straight forward case.
I guess force is the wrong word...they are pushing L3 to make a decision on pricing in the markets where they compete. If L3 keeps the same prices Cogent will take a lot of customers from L3 and basically push them to do something ie cut off peering to try and get Cogent to raise prices. If Cogent doesn't raise prices and they keep taking customers from L3 even if Cogent works out something to pay L3 for the peering I would still think Cogent gets the better deal...more customers and more revenue and hopefully for them more profit. Also, there has been no proof from either side what the "agreement" is/was and whether either party broke the agreement in anyway.

Combat Chuck
Too Many Cannibals
Premium
join:2001-11-29
Erie, PA

Re: Just pay

I'm pretty sure peering agreements are pretty much standardized and that a big part of it is that either company can withdraw from the agreement for any reason as long as they give a set number of days warning.
--
Note to producers:First person view + movie = bad

sbrook
Premium,Mod
join:2001-12-14
H0H 0H0
·Rogers Hi-Speed

Host:
Rogers
Bell Canada

What do you mean "Still squabbling"?

This is old news and the article reveals nothing new that was said after the agreement by Level3 to reopen the connection.

In fact it goes as far as saying that as of yesterday, Cogent and Level3 have NOT been in communication since peering was restored. That's hardly squabbling.

This is a non-article.

Karl Bode
News Guy
join:2000-03-02

Host:
Road Runner
PC gaming GAMES
PC gaming Tech

Re: What do you mean "Still squabbling"?

Squabbling in the press is still Squabbling.

quote:
Cogent CEO Dave Schaeffer told Light Reading Wednesday that the real reason Level 3 clipped the peering connection last week is because it believes Cogent is pricing its Internet service at “below cost,” making it hard for Level 3 to compete.

"In mid-September I got a phone call from a very senior person at Level 3, and in that telephone call they said, 'We’re going to cut you off if you guys don’t either pay us or reconsider your pricing strategy and raise prices,' ” Schaeffer says.
quote:
Level 3’s O’Hara strongly denies Schaeffer’s claim. “I have heard this allegation before and we take it very seriously, and to my knowledge nobody from this organization has made that request of Cogent, and that’s as far as I’m going to go with that,” O’Hara told Light Reading Thursday.

O’Hara says after Cogent didn’t respond to several notifications that de-peering was imminent, his company assumed Cogent had made a comparable peering arrangement elsewhere.

sbrook
Premium,Mod
join:2001-12-14
H0H 0H0

Re: What do you mean "Still squabbling"?

I did say "nothing new"

TK Junk Mail
Go ahead, make my day
Premium
join:2002-03-03
Margate City, NJ
clubs:
·Comcast

Gov't can't force peering of private companies

US law can't force 2 private companies to connect their networks. That is a contractual agreement between the parties. If the FCC and/or the politicians see a problem here, then their only solution would be to create a government funded and built backbone network that all ISPs could connect to for a fee.
--
--
Join Red Room Forum
My Web Page

Dagda1175

join:2001-06-17
Goleta, CA

Re: Gov't can't force peering of private companies

but they CAN enforce long existing contract law!

TK Junk Mail
Go ahead, make my day
Premium
join:2002-03-03
Margate City, NJ
clubs:
·Comcast

Re: Gov't can't force peering of private companies

said by Dagda1175 See Profile :

but they CAN enforce long existing contract law!
Level 3 didn't break their contract with Cogent. They had to give 60 days notice and they gave much more than that.
--
--
Join Red Room Forum
My Web Page
RoadWarrior

join:2002-10-22
USA

Level 3 trying to crush Cogent

This whole "squabble" is really about Level 3 trying to crush a competitor.

quote:
Cogent CEO Dave Schaeffer told Light Reading Wednesday that the real reason Level 3 clipped the peering connection last week is because it believes Cogent is pricing its Internet service at “below cost,” making it hard for Level 3 to compete.

As the article states: "In mid-September I got a phone call from a very senior person at Level 3, and in that telephone call they said, 'We’re going to cut you off if you guys don’t either pay us or reconsider your pricing strategy and raise prices,' ” Schaeffer says.

Cogent sells Internet access for around $10 per megabyte, according to the company, while the Level 3 rate is somewhere between $25 and $60 per megabyte.
All this is is one company wanting to crush the other one with no care for the customers of either company.

TK Junk Mail
Go ahead, make my day
Premium
join:2002-03-03
Margate City, NJ
clubs:
·Comcast

Re: Level 3 trying to crush Cogent

said by RoadWarrior See Profile :

This whole "squabble" is really about Level 3 trying to crush a competitor.

All this is is one company wanting to crush the other one with no care for the customers of either company.
That is Cogent's take on it. But Level 3 and very few others agree with Cogent's assertions.
--
--
Join Red Room Forum
My Web Page
The Way Out

join:2003-01-20
That's nice, it looks like you're buying into hype. Everything you're reading is Cogent spin. Read the previous 3 articles on DSLR about this subject and then take a guess at who's the bad guy.

Combat Chuck
Too Many Cannibals
Premium
join:2001-11-29
Erie, PA

Re: Level 3 trying to crush Cogent

said by The Way Out See Profile :

That's nice, it looks like you're buying into hype. Everything you're reading is Cogent spin.
But that's what Cogent wanted now isn't it. As I said previously no one cares who's actually at fault, all they know is level3 did something, now their internet doesn't work as well, therefore level3 is at fault.

If anything someone needs to look into just what Cogent did to prepare and if their lack of preparation was actually the planned response.
--
Note to producers:First person view + movie = bad

JacksGhost
Got Bottle?

join:2002-12-29
Buffalo, NY

..

"But there could be a lesson here: Enterprises might want to investigate whether their ISPs have contingency plans in place so that access to the Internet is never put in jeopardy."

WoW! the voice of reason. Always have a backup for your business.
dentman42

join:2001-10-02
Columbus, OH

Re: ..

All I know is if I were hosted with either Cogent or Level3 I'd be finding a new host at this point and screw both of them.

annony name

@Dial1.Tam

Backfired

I think cogent was dumping a large share of their traffic immediately onto level 3 and then had so much extra bandwidth they couldn't sell it. So they offered free bandwidth for a year to heavy level 3 bandwidth users. They tried to put them out of business and become a tier one provider buying level 3 at bankruptsy. It backfired and now they will have to go to sprint and pay for the bandwidth they were stealing and contractually giving away to level 3 customers. They demand level 3 give them service. Let them buy it somewhere else.
GenBlood

join:2005-04-14
Nashua, NH

The REAL reason ...

Cogent peering traffic is increasing and Level(3) network
traffic is up. Their is more Cogent traffic then Level(3)s
traffic. The bottom line is Level(3) isn't getting payed for
all this extra traffic. Level(3) thinks they should get payed
for all this extra bandwidth.

I agree, no free rides .... Cogent should pay ... Level(3)
should cut them off...
st7860

join:2004-05-13
San Francisco, CA

Re: The REAL reason ...

so basically people in this thread are saying that its reasonable in this day and age to pay more than $3,000US a month for 100megabits and more than $10,000US a month for 1 gigabit.

the_real_deal

@static85984417.ttnet

Re: The REAL reason ...

It has nothing to do with Level 3's massive amount of subscribers downloading Cogents traffic, or Cogent providing cheap hosting for good prices to a large amount of websites...

It has to do with Level3 loosing almost 300 million and wanting to charge money for traffic on both ends.

It's easy what a little reading will do...
tkdslr

join:2004-04-24
Pompano Beach, FL
·Speakeasy

Re: The REAL reason ...

said by the_real_deal :

It has nothing to do with Level 3's massive amount of subscribers downloading Cogents traffic, or Cogent providing cheap hosting for good prices to a large amount of websites...

It has to do with Level3 loosing almost 300 million and wanting to charge money for traffic on both ends.

It's easy what a little reading will do...
Those L3 losses can be deceiving.

»quicktake.morningstar.com/Stock/···=finance

As you can see from the Cash flows..
Most of L3's 2004 losses(85%) are due to investment losses. Mostly from buying up assets from bankrupt or near bankrupt comm's providers. (Genuity, Williams, 360 networks, ICG dialup, Sprint dialup, etc.. )

Free cash flows

@tejassec.com

Re: The REAL reason ...

Operating cash flow doesnt mean much if you have to spend money on your networks' growth (capital expenditures) take a look at their free cash flows. They are negative. Then look at their debt load, you gotta pay that interest on those high-yield notes. Now check their bond prices, hmm, things don't look so good for Level 3. Now what happens when Cogent takes all their traffic and routes it over another network, the revenue goes with em'.

Dan
Professor Lava Hot
Premium
join:2002-12-17
Eh?
·Rogers Hi-Speed

Yes. If Cogent doesn't see value in the product go somewhere else.

Man, If I could walk into any store and cause a fuss, but get cheap prices I would, but thats not how we have created our market.
--
I do believe you hit the G-nail on the G-head. - karl

ash1234

@nvbell.ne

Re: The REAL reason ...

Yes of course Cogent should pay at their agreed upon contract pricing until they renegotiate. However if what Cogent is claiming is true there is a bigger picture. That would mean that Level 3 was soliciting a crime of collusion to price fix (price gouging). Where everyone seems to think gas companies are doing it right now, which they aren't (look up market forces if you question this.) The call that was allegedly made by all means would be considered a criminal action against the public by the nature of what they were asking them to do. If the company can't weather market forces then it doesn't have a good business plan and should be eaten up when they go bankrupt or go to jail when they try something illegal like that.
Forums » Cogent/Level3 Still Squabbling


Friday, 09-Jan 07:33:29 Terms of Use | Privacy Policy | Hosting by www.nac.net - DSL,Hosting & Co-lo | feedback | contact
over 9 years online! © 1999-2009 dslreports.com.