A local internet exchange point is defined as a public peering point serving the local internet industry. Local means where it becomes cheaper to interconnect with other ISPs at a common location and it is to pay transit to another ISP to reach the same consumer base local can actually mean different things in different regions local can mean the local city local can mean the local country it really does depend where you are on the globe about what a local internet exchange point is a regional internet exchange point is also a local internet exchange part but is now large enough that it attracts regional ISPs and ISPs from outside the local area who want to appear with each other once the regional ISPs start peering of course they could offer transit to some of the local providers around this exchange part and the local ISPs can pair with other ISPs from outside the locality because they don't compete in each other's markets they don't have to pay transit costs to the transit providers and quite often you find the ISPs of disparate sizes and influences will happy like peer with each other simply 2d freight transit costs it's cheaper for them to turn up at a regional exchange point and peer with each other than it is to buy transit to do the same thing so which i XP would we go to well it all depends on how many routes are available what is the traffic to and from these destinations and by how much it will reduce the cost of transit and only the network operator who is asking these questions can work out the answer as we have covered in the multihoming presentations looking at traffic flow data net flow and so forth are very very important to help decide where to turn up there's no point going to an exchange point if there's negligible traffic from the networks that are connected what is the cost of the colocation space it was prohibitive of the space is not available it's pointless going to that exchange part what about the cost of running a circuit to the location it might be a very attractive location but if the infrastructure to get there is cost prohibitive or becomes competitive with transit costs it's pointless going to that exchange part also what about the cost of remote hands or remote assistance if there are no remote hands would you realistically jump in an aeroplane every time there's an outage it means that doing maintenance becomes very challenging and is potentially costly if there's a serious outage so just to summarize this let's have a look at the value propositions peering at a local exchange point reduces latency and transit costs for local traffic and it improves the internet quality perception after all the end user expects the fast internet with local traffic low latency and more or less unlimited bandwidth at an exchange point local peering and access to content hosted locally or very close to an exchange point is of vital importance to ensure a happy customer base and a vibrant local internet economy. Participating at a regional exchange point might well mean offsetting transit costs to get access to the same content. It also means we have to manage a connection back to the whole network but the most important thing we want to achieve is to improve the internet quality perception for our customers.

© Produced by Philip Smith and the Network Startup Resource Center, through the University of Oregon.

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