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PSINet to peer with small potatoes

After tapping a wellspring of bandwidth earlier this year, PSINet now plans to share the wealth with small ISPs by letting them interconnect with its network for free.

After tapping a wellspring of bandwidth earlier this year, PSINet (PSIX) now plans to share the wealth with small Internet service providers by letting them interconnect with its network for free.

The news comes in the wake of UUNet Technologies' (UUNT) declaration in May that it would no longer "peer" with ISPs that couldn't handle traffic at the same rate that it could. Peering allows ISPs of similar size to route each other's email or Web data to places on both of their networks.

"If you don't have that peering, it shuts off part of the Internet from communicating with another part of the Internet. It's like shutting off an interstate highway ramp that goes to a farm and market road," John Kraft, PSINet's vice president of wholesale network services, said today.

PSINet's move will likely make it a favorite of the little guys over players such as UUNet. UUNet's decision affected at least a dozen ISPs who were already interconnecting with the company. The national ISP said smaller providers that weren't up to par on traffic would have to pay an existing monthly rate of $2,000 for a T1 connection and $6,000 for a fractional T3 connection.

"Those changes have made it more difficult and produced a lot of anxiety for small ISPs," Kraft added.

UUNet's policy shift sent some small Net providers into a frenzy, with one of them even threatening to sue over the change. UUNet eventually pacified most of the protesters, including Whole Earth Networks and NetRail, both of which cut confidential deals to continue peering with UUNet.

"I think what UUNet wanted to do was a good thing for UUNet. What PSINet is doing is good for them, but it's good for a lot of other people too," said Scott Hazen Mueller, vice president of engineering for Whole Earth Networks. He said the free peering will help PSINet build out its reach, making it a more desirable ISP.

"If we don't already have an agreement with PSINet, we'll look into it," he added.

But PSINet's offering has more to do with available bandwidth than with marketing or generosity. In July, the veteran ISP garnered 10,000 miles of OC-48 fiber backbone, which transmits data at 2.4 gbps. PSINet gave up 20 percent of its equity to digital network supplier IXC Communications in exchange for the bandwidth. PSINet will get its first allotment of the new backbone in January.

"The bandwidth is more than we need for today's Internet applications," Kraft said. "Peering seemed like a pretty reasonable way to use it."

Kraft will be the first to admit PSINet has something to gain from its small-ISP friendly attitude. It will offer providers new, for-pay services such as selling parts of its backbone or "transit products," which connect ISPs to areas outside PSINet's reach.

"We'll get money for that, but we won't have the pricing until January," he said.