March 20, 2008

Contract Dispute Cuts Off Internet Communications

As of last week, customers of Cogent Communications Group and TeliaSonera AB, two major Internet service providers, were unable to communicate with each other over the Internet without backup connections from other providers.

"Basically, parts of the Internet can't talk to each other," explained Earl Zmijewski, general Manager of Renesys Corp.'s Internet data division, which tracks how carriers route their Internet traffic.

It's essentially as though Cogent and TeliaSonera customers are on different Internets. For example, some U.S. Web sites hosted by Cogent customers are now inaccessible to Web surfers in the Nordic countries, where Sweden-based TeliaSonera is the largest telecommunications carrier. 

However, it's not the first time something like this has occurred.  Every once in a while, Internet providers indulge in what Zmijewski calls playing "chicken." If they're in contract disputes, they disconnect each other and wait to see which provider will back down first, with the number of angry customers each company faces likely determining who comes out on top.

Cogent CEO David Schaeffer said the two companies had a "peering" contract, under which they exchanged traffic from each other's networks. Under the contract neither company paid the other for access.  

But Schaeffer said TeliaSonera continuously breached the terms and conditions of the contract by not exchanging traffic in certain locations and neglecting to upgrade saturated connections. That forced Cogent's traffic to take long detours to reach its destination, according to Schaeffer.

Schaeffer cited an example of Cogent data from Europe that had to be first carried across the Atlantic to the U.S., then hand it over to TeliaSonera, which carried it back across the Atlantic to its European destination.

Cogent cut its direct links to TeliaSonera on March 13, and for a short time thereafter customers of the two companies were still able to connect indirectly through intermediaries connected to both networks. But according to Renesys, that possibility disappeared on Friday.

Schaeffer said the loss of alternate routes had nothing to do with Cogent, and speculated that TeliaSonera may have refused payment to other providers for traffic destined for Cogent.

TeliaSonera did not comment on the allegations. Maria Hillborg, a company spokeswoman, said the two companies were trying to work out an agreement, and that a "requisite for that agreement is that TeliaSonera receives the compensation Cogent owes us."

But Schaeffer denied the companies were in negotiations.

Cogent has 15,000 customers, most of which are large enterprise, government and academic institutions. Nearly all have backup links from other providers, or use the Cogent link as a backup to their main provider and can still connect to TeliaSonera's 36.1 million customers indirectly.

Schaeffer said Cogent's recent expansion into the TeliaSonera's home territory was likely behind TeliaSonera's reluctance to improve connections.  "We've become much more aggressive as we have expanded our network about four months ago in Norway and Finland," he added.


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