Home Asia-Pacific II 2014 How the Internet does business

How the Internet does business

by Administrator
Ricky ChauIssue:Asia-Pacific II 2014
Article no.:6
Topic:How the Internet does business
Author:Ricky Chau
Title:VP, Asia Pacific Sales
Organisation:Level 3 Communications
PDF size:197KB

About author

Dr. Chau is vice president of Asia Pacific Sales at Level 3 Communications (NYSE: LVLT) and is based in Hong Kong. In this capacity, he is responsible for driving wholesale and enterprise business in the Asia Pacific region.

Dr. Chau has over 15 years of management experience across numerous functional areas in the telecommunications industry, including sales and marketing, product management and business development .This experience has helped him cultivate extensive business acumen throughout the Asia Pacific region.

Dr. Chau joined Level 3 from Global Crossing, where he served as vice president of carrier services and general manager, Asia. Prior to this, he led the carrier sales and global partnership program in Asia Pacific since joining Global Crossing in 2008.

Dr. Chau earned his doctoral degree in business administration at Hong Kong Polytechnic University and holds an EMBA degree from the University of Ottawa.
Not everything being equal for your Internet provider

Article abstract

Asia is very fragmented in terms of broadband penetration and access speed, it is this confinement which includes both the nations with the fastest access and high penetration as well as some nations with very low access speeds or adoption. Over 90% of Internet traffic in Asia Pacific is routed through submarine cables, which will occasionally be interrupted by natural disasters or fishing boats. Internet traffic continues to evolve in both size and complexity as we migrate from basic file sharing to more robust applications. Both economically and operationally, the Internet has become critical to businesses’ success.

This article begins with a high-level review of how the Internet has evolved in the way Internet Service Providers (ISPs) do business. It shows why it’s difficult to rely on a simple classification system to show ISP quality. Finally, the article details criteria for sorting out the options and choosing an ISP that can support a reliable, secure and predictable Internet experience for your business.

Full Article

Given its importance, one would assume that we all understand how the Internet works. We know it’s a big network, connecting users and content providers together. But it’s not just one big, interconnected Cloud. There is no one Internet.

When the Internet first started, there really was only one network. Anyone wanting to be connected had to join via the single ISP, the Defense Advanced Research Projects Agency (DARPA). That was 1969. In the 1980s, privately run ISPs were allowed to connect, and the Internet as we know it began. Each of these private ISPs developed and managed their own Internet Clouds. In most cases, the ISP’s Cloud consisted of connections to end users of Internet services.

Later, as more content providers emerged, the Clouds became more jumbled with ISPs providing connections to both the content sources and the content consumers. The Internet became a collection of inter-connected Internets. Today, there are thousands of ISPs. In the beginning, providers managed their own networks, but now there are many different business models. Some ISPs do not own a single hard asset. They resell connections provided by other ISPs. ISPs are classified in a number of different ways to help Internet users understand the type of ISP they are connected to. A Tier 1 ISP, for example, is an ISP that creates a core portion of the Internet. These ISPs are able to connect anywhere in the Internet without having to pay any other ISP for transit. Depending on your reference source, there are only about 20 Tier 1 ISPs in the world.

The difficulty of relying on simple classifications

For good reasons, connecting to the Internet through a Tier 1 provider seems like the way to go. But that’s easier said than done. Although ‘Tier 1 ISP’ has a very simple definition, finding a true Tier 1 provider is anything but simple. The definition of a Tier 1 provider involves money changing hands, and those business agreements are subject to non-disclosure agreements. Quite simply, an ISP can claim to be Tier 1 by claiming reciprocal, no-cost peering agreements with other ISPs, and it would very difficult to find data proving otherwise.

This brings us to another aspect of the complicated world of moving data: peering and transit. Internet peering occurs when ISP networks are connected together for the purpose of passing traffic between them. In an Internet transit arrangement, on the other hand, one party pays another to connect. Transit connections are used when an ISP wants to reach networks through another ISP, rather than building connections of their own. Who gets to peer and who has to pay transit is largely dependent on what part of the Internet the ISP brings to the Cloud. If an ISP is just trying to reach more of the Internet, then most likely they will have transit connections. It’s a complicated business model that often results in connections that do not travel the shortest path. Even though you’re surfing a website located in your city, your connection might travel thousands of miles, because the web server and your computer are connected to different ISPs.

Check for meaningful Service Level Agreements (SLAs)

Examine your relationship with your ISP in the same light that you’d consider any business partnership. If you’re relying on your ISP to provide a reliable connection, get it in writing. If an ISP doesn’t provide written SLAs with clearly defined remedies, take notice. If they have SLAs, be sure they’re meaningful and that the SLAs are based on achievable metrics. Many SLAs only cover the ISP’s network, not the actual connection to your business. A high-quality ISP will back your service even if the connection to your business is provided by a local carrier rather than the ISP. Look for an SLA that will cover your entire service, end-to-end.


To use the Internet, at a minimum, you’ll need a router and a firewall. However, not every company wants or needs to build the expertise it takes to manage or configure these devices. Even if you do have these skills within your organization, perhaps you just need some help configuring them properly so you can get the most out of your service. Your ISP should provide options to help with these concerns.

When it comes to networking, ISPs have inherent expertise. Look for one that is willing to share it. Managing and configuring devices, protecting assets from attack, and figuring out billing terms that work — find a provider that offers options to support your efforts. It can yield a more productive, secure Internet experience. After all, your ISP should be the expert in building and maintaining Internet Protocol networks. Who would be better to consult and collaborate with? The right ISP can help you maximize your return on your Internet connection.


The more your business relies on the Internet, the more attention you must give to protection. Besides the day-to-day threats from viruses and spam, you need to deal with other types of attacks from hackers, such as denial of service (DoS), advanced persistent threats (APTs) and other types of service attacks. Another type of attack, a distributed denial of service (DDoS) attack, is a sophisticated process specifically targeted at a business to deny them to be accessed or to cause a failure of their IT resources. While these types of attacks were initially aimed at large organizations, DDoS attacks have become more prevalent for smaller organizations. Because your ISP operates in this environment at all times, they must protect not only their own assets from attack; they should also be able to help protect yours.

Take a close look at connectivity

Measuring connectivity within the Internet is not a trivial task. Eventually, everybody can connect everywhere. But as anyone who commutes on a regular basis can tell you, there’s a big difference between getting there on back roads and driving in the express lane. In the world of ISPs, the fast lane is created by two things: lots of capacity, and on-ramps and off-ramps in the right places. Fixed Orbit is a public source for ISP connectivity data. The organization maintains the Knodes Index, which provides a ranking based on the number of Internet hops it takes for users on a particular ISP to reach any other ISP. Lower numbers indicate how closely interconnected an ISP is with other providers. Working with a well-connected ISP means your data reaches its destination as quickly and safely as possible.

Find an ISP with ownership

Arguably the biggest value that an ISP brings is the highway itself: the communications network they use to build the Internet. Not every ISP operates, manages or builds in the same way. For ISPs, creating the Internet is a business process. Does your ISP operate by buying their Internet bandwidth or are they mostly a provider of bandwidth to others? ISPs that purchase connectivity have two cost elements: the expense of building or leasing their own network plus the expense of connecting to other networks.

Their margins may be tight and they might be compelled to oversubscribe their networks at a higher rate. On the other hand, ISPs that generate revenue mostly by reselling their own network assets are incented to create a highly functioning network. They will likely work to minimize congestion and make plenty of bandwidth available.


As the Internet’s role in supporting business continues to expand, you can expect high-quality resources to result in higher returns. Not all ISPs operate the same way. When it comes to supporting your business, find an ISP provider that’s willing to back its reliability claims by putting it in writing with end-to-end SLAs, and one that’s willing to collaborate. Carefully examine connectivity to gauge whether a provider has the on-and-off ramps to efficiently connect your data. Finally, consider ownership, and whether their way of doing business works to give you the best Internet experience possible.

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