Tag Archives: DiViCloud

What question do you like most from a prospect customer?

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The question I like most is – “so how much money do you save me?” That’s usually a sign that we have shifted gears from pre-sales to negotiations. Even better, negotiations now start from the value we bring rather than the cost we incur.

Wholesale data capacity is quasi-commoditized (see Capacity Magazine), so market prices are known by the parties. Therefore it seems simple to calculate the value in replacing physical capacity with virtual capacity. Let’s consider an ISP with 3Gbps, paying $50/Mbps/month. By using DiViCloud, the ISP can now add 1Gbps of virtual capacity over the existing 3Gbps link. Seems simple – we provide a value of 50 x 1,000 = $50,000/month or $600,000/year.

It doesn’t end there. To add 1Gbps of traffic the ISP would typically take additional 1.2Gbps capacity, to avoid congestion. DiViCloud, on the other hand, generates virtual capacity, so there is no need to take spares; the traffic simply does not load the network. The alternative cost of 1.2Gbps physical capacity is $60,000/month or $720,000/year.

Moreover, DiViCloud’s capacity is charged by consumption, based on 95/5 model (see Dr. Peering). Physical capacity’s fees are usually for committed bandwidth, whether used or not. To compare apples to apples the ISP should consider the alternative price of burst-capacity rather than committed. Naturally this figure is higher. For example $65/Mbps/month, rendering DiViCloud’s value as $78,000/month or $936,000/year.

95/5 pricing model; Dr. Peering (http://drpeering.net/core/ch2-Transit.html)

The typical question at this stage is – “Yes, but all you are doing is deferring costs and not replacing them. As demand increases we will eventually have to purchase additional physical capacity”. Well, if this were the case, then once the physical capacity is in place the ISP could turn off DiViCloud.

Physical capacity & virtual capacity mix

Physical capacity & virtual capacity mix

Virtual capacity is equivalent to adding an upstream pipe; it provides perpetual benefit regardless of the basic physical capacity. Actually, the ISP should always plan to take about 70% of its capacity from physical upstream providers, while 30% will be provided as virtual capacity at Half Price.

Relevant Posts:

How can the IP price gap be bridged? Hint: Beam me up Scotty

Is IP Transit a commodity?

Demand for International data capacity grows 50% and more annually

Can Broadband Access Heal The World Economy? (To be discussed at G20)

 

 

White Smoke Over-The-Top

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Internet behavior during special events is always of interest. Last week we had our eyes on the Sistine Chapel chimney and its manifestation across the Internet. When would the black smoke turn white?

Naturally many viewers across the globe were watching live video from the Vatican simultaneously. The smart nodes in our DiViCloud network could identify these simultaneous similar sessions.

We found out that high peaks were demonstrated in international traffic flowing to Central American and specifically to Costa Rica and El Salvador. The graphs below, taken from a specific ISP in Costa Rica, show the clear live traffic spike, comprising over 10% of the total international traffic.

Picture1

Our DiViLive value-added-service unifies multiple live-video sessions into a compacted format. By using DiViLive, ISPs can load x10 live sessions on the same bandwidth.

How vulnerable is international connectivity?

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I came across an interesting BBC article – “The Internet’s weakest links,” analyzing the vulnerability of a country’s international connectivity. The vulnerability metric, adopted from Renesys’ blog, is the number of international Internet gateways (IIG) a country has. To be more precise – the number of AS (autonomous systems) actually connected to networks abroad. Renesys term this a Country’s International Frontier.
Let’s take Myanmar as an example. Searching Hurricane Electric’s database for networks in Myanmar you will find five AS’s. Digging a bit you’ll find that only MPT (AS45558) connects to international networks, whereas the other networks connect to the world via MPT. Myanmar has, therefore, only a single company in its international frontier, making it very vulnerable.

International connectivity vulnerability

Governments in several countries enjoy centralization of international connectivity, enabling them to monitor, filter or block all international traffic. You often see countries with a single IIG, owned by the incumbent telecom operator, which in turn is government controlled.
Nevertheless, appreciating the drawbacks in narrow international frontier, regulators are slowly relaxing their policies, slowly opening the IIG market, while maintaining most of their interests.
ISPs served by the DiViCloud network actually peer with us (AS57731) over-the-top of their existing upstream providers, enjoying the benefits of direct international peering, without physical connectivity. That is, of course, apart from the 50% discount they have on the international capacity.

How do you think this map will change two years from now?

Is there a case for Internet Exchange Points in Internet edges?

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We have recently witnessed proliferation of Internet Exchange Points (IXP) in remote locations, away from the main traffic hubs. More and more IXPs are established in S.E.Asia, Africa, Middle East; some by NPOs (e.g. ISOC, NSRC), some by well established Exchanges (e.g. DE-CIX), and some by local for-profit ventures.

Local IXP serves as the meeting point between local networks, instead of exchanging traffic abroad, as viewed in the following image (source: Analysys Mason).

Traffic flow without (left) and with (right) IXP

Traffic flow without (left) and with (right) IXP. Source: Analysis Mason, 2012

The benefits in having a local IXP are:

  • Saving international bandwidth cost
  • Improving QoE by reducing latency for local content
  • Encouraging hosting of local content
  • Pulling in international CDNs
  • Enabling local online services (e.g. governmental)

The commercial value of setting up an IXP in emerging markets is quite elusive. Critical local traffic mass is required to justify IXP establishment. Yet international capacity prices, poor QoE and lack of local content inhibit accumulation of such mass.

At DiViNetworks we continuously analyze which IXPs to join and connect to our DiViCloud network. Looking at the global data flow, we calculate the benefits our customers and will enjoy if we join an IXP. We have already directly joined  HKIX (Hong Kong), Equinix-Singapore, Equinix-Sydney, MSK-IX (Moscow) and PTT Metro (Sao Paulo). We participate in all major IXPs through our upstream providers and plan to join additional IXPs soon.

Does LTE impact traffic patterns on the International network?

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LTE is becoming a reality  in developed countries, but even more in emerging markets. The reasons being (a) many developing countries do not have fixed broadband infrastructure (b) MNOs and MVNOs skipped the 2.5-3.75G bubble and enjoy capital and demand.

LTE’s RAN indeed offers broadband speeds. LTE backhaul is addressed by major vendors (some of which are embedding DiViNetworks’ technology). Yet deploying LTE in emerging markets places a huge load on the feeding International link.

Some MNOs in such markets connect to the Internet by merely a single STM-1 (155Mbps) – that’s equivalent to the RAN capacity of 1.5 LTE cells. These operators will invest tens of millions in rolling out LTE, yet will have to spend similar amounts per year to feed the bandwidth beast.

Core Analysis’ Patrick Lopez explains the elastic nature of video traffic – let it have one finger, it takes your whole hand. Combine this with 85% of LTE traffic being video (Vodafone Germany) and the challenge is clearer than ever.

At DiViNetworks we are focused on helping ISPs (that includes MNOs) to change the economics of their international links using our DiViCloud network. Some of our MNO customers are planing to deploy LTE soon and are working closely with us on sizing their International network.

Packet Loss – International and Access – Asia, LATAM, Africa

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Handling over 100Gbps for over 50 ISPs worldwide, combined with smart devices on international and domestic PoPs, the DiViCloud Network holds a unique view on packet flow in international networks.

We recently are taking a closer look at packet loss on international and domestic links. Surprisingly, high packet loss occurs also during off-peak hours, without any congestion on the line – see results below. Such packet loss results in compromised QoE.

Packet loss – International and Access – DiViCloud’s Hong Kong PoP – Serving S.E.Asia

Packet loss – International and Access – DiViCloud’s NYC PoP – Serving LATAM

Packet loss – International and Access – DiViCloud’s Amsterdam PoP – Serving Africa

Summary of the above findings is presented below.

Packet Loss on International Links as Measured by DiViCloud

Holding both sides of the link, DiViNetworks can almost eliminate such packet losses, significantly improving end-users QoE.

An interesting case occurred this week, when a carrier providing transport from Singapore to one of our customers, suffered fiber fault. The following figures present the packet-loss rate prior to the fault, and during the fault.

Packet loss – International and Access – DiViCloud’s Amsterdam PoP – Serving Africa

Packet loss – International and Access – DiViCloud’s Singapore PoP – Serving S.E.Asia – During Fiber Fault

Additional observations are offered in our Global Data Flow Report.

New DiViCloud PoP in Sydney, Australia

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We’re happy to announce the DiViCloud network expansion with our newest DiViCloud PoP in Sydney, Australia. We now operate 12 PoPs worldwide.

The DiViCloud PoPs Map

DiViCloud PoPs are located close to content sources, rather than close to eyeballs.The opposite is true for a CDN which is placed close to the content consumers. By selecting such locations, DiViCloud can apply the technology on almost all the traffic transferred to the ISPs and thus generate more virtual capacity.

How do we know where to place PoPs? We continuously analyze traffic sources and routes. As we see more traffic originating in a new location we conduct an economic analysis for capturing this traffic. We need to conclude if the price gap can be bridged with this part of the traffic.

Since we have started serving virtual capacity to the pacific, we learned that more and more traffic originates in Australia. The main driver being CDNs, who established and scaled up their Australian PoPs. Wholesale capacity economics in Australia and the pacific is challenging jigsaw puzzle; and we have solved it.

Using our new PoP we can now improve our service to Australia, New Zealand and Pacific ISP customers.

How can the IP price gap be bridged? Hint: Beam me up Scotty

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In my recent post I highlighted the differences in IP transit cost between locations. At the low end of transit costs are those locations where content is generated – major cities in which the major content server farms are located (typically in the US and in W. Europe major cities). Baseline prices of $0.5-1 per Mbps per month are the actual cost for placing it on the web. From there on, prices start to rise as the factor of transport costs go up and as the distance grows from the content source creation to the content consumption destination.

The further away the eyeballs are, the smaller the market is. The fewer the transport alternatives are, the longer the transport chain is – and the price of transport (obviously) increases.

Actually this model is no different than shipping any other goods. An orange in California costs $0.5 per kg in wholesale prices. In Vancouver, wholesalers charge $3 since they have to pay the $0.5 and an additional $2 transport fee, plus they want to make a profit. The supermarket owner in  the remote Whitehorse, Yukon, pays $12 for the oranges. What starts off at $3 in Vancouver, plus a cascade of transporters all the way to Whitehorse inevitably drives up the cost to sell those oranges. No one is ripping anyone else off in this process. But is there a way to provide affordable oranges to Whitehorse?

What if you could just teleport the oranges from California to Whitehorse? What if this teleportation could be achieved at fractions of the transport cost, and without involving any middlemen?

That’s exactly what we do at DiViNetworks; for bits, not oranges. We are able to teleport 30-50% of the content from its source to any destination worldwide, without loading any transport, and over any combination of transport networks. No data is lost along the way. That’s what we term VIRTUAL CAPACITY.

We share the price gap between our cost and the market IP price with our customers, guaranteeing that our customer ISPs pay HALF PRICE for the additional bandwidth.

Beam me up Scotty for a Free 14 Day DiViCloud Trial

Follow our LinkedIn for more information and statistics on International Bandwidth.

Adding S.E.Asia and Carrier Traffic to our Global Data Flow Report

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We recently released a first glimpse to our Global Data Flow report. Located at major Internet junctions, the DiViCloud network oversees masses of traffic in different locations, providing us with insights about traffic patterns and sources. Below is an updated graph, which includes information about traffic in S.E.Asia, as well as traffic originating from major local and global carriers.

CDN and Carrier contribution to ISP’s traffic, as measured by DiViCloud network in: LATAM, Africa, Europe, S.E.Asia and CIS.

Follow our LinkedIn or you can go here and fill out a form to be notified when the report is available.

Global CDN traffic contribution in LATAM, CIS, Africa and Europe

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We recently announced our Global Data Flow report, analyzing the flow of mass data in our growing DiViCloud network. We are busy finding our way in the masses of information accumulated in our PoPs, so in the meanwhile I wanted to give you a glimpse.

Global CDNs (content distribution networks) play a primary role in traffic flowing into ISP networks, comprising around 40% of the overall traffic volume. The figure below depicts the CDN mixture in various territories.

CDN Traffic Contribution DiViCloud

CDN contribution to ISP’s traffic as measured in the DiViCloud network

The Global Data Flow report will include, inter alia, the contribution of global CDNs  by territory, network, time-of-day and other factors. We will also analyze other sources of content, their logical and geographical flow, as well as overlaps and differences between ISPs in different territories.

Follow our LinkedIn or you can go here and fill out a form to be notified when the report is available.