August 2007 Archives

Cogent (AS174) sells IP transit and they sell it cheap. Everyone knows this. It is how they position themselves. It's their competitive advantage. It's why they think they will take over the world. They plan to undercut the prices and margins of all of the bigger carriers, combine that with strategic (cut-rate) acquisitions, and wait for everyone else to go broke. So far they're doing a pretty good job of executing on that plan.

However, I recently learned that "Cheap" isn't actually Cogent's secret market advantage at all. I'm not denying price matters to people who buy from Cogent. Heck, that's why Renesys decided to buy from Cogent for a development installation for Babbledog. (There will be more about Babbledog here shortly, as I'm sure it's something that many of Renesys's network-centric customers will have some questions about.)

This is a tale of a network-clueful small company trying to get connectivity at a well-connected building in Boston at a reasonable price. This is a tale of sorrow and woe, misery and despair. I'd like to say it has a happy ending, but on review, I believe that many of you will conclude, at least for the IP transit industry, that the ending is not happy at all.

So after the massive, content-free debate about network neutrality, there is finally something concrete to discuss. Recently, several people have been writing about ESPN360: a website that attempts to block subscribers arriving from an ISP who is not a subscriber. Essentially, they are trying to replicate the cable subscription model (get your ISP to pony up money so that you can see this stuff) only on the web.

It would be hard to overstate just how foolish (and wrongheaded) this is. But the entire escapade makes some very important points in the debate about net neutrality. That debate was never about some mythically "neutral" network, but was rather about the ever-shifting balance of power between content and eyeballs. Content providers (Google, Yahoo, BBC, and evidently ESPN) believe that users want their content more than their content wants the users. And so, a new battle is begun. Who has more leverage: the pretty pictures or the glassy eyeballs?