Internet IP Transit Provider

What is an Internet IP Transit Provider?

There are two types of interconnection that allows Internet networks (or Autonomous Systems) to connect directly and indirectly over the Internet, referred to as peering and transit. These two terms are sometimes used interchangeably, but they are not the same.

A vital characteristic of a peering relationship between two networks is that peering is settlement-free transport. However, the costs are not zero, because there are costs associated with co-location, the power to the routers and switches, and cross-connects that are consumed to implement the peering connectivity.

Transit, on the other hand, is a form of interconnection in which an ISP or customer purchases an Internet bandwidth connectivity service offering access to every publicly reachable destination on the Internet, commonly referred to as "full" transit." An Internet Transit Provider is an ISP that provides transit to customers as a paid transport service.

Transit allows traffic from an ISP or customer network to cross or "transit" the Transit Provider network to connect to the rest of the Internet. Internet Transit is also referred to as Internet or IP Transit. To add complexity to this jargon's usage, Transit Providers are sometimes called "upstream providers."

In the peering case, two ISPs only exchange the routes of their downstream customers and neither can see the other's upstream routes over the peering connection. In the case of IP Transit, the IP Transit Provider, as part of its Internet transit service, provides routes to the rest of the Internet, including those of their downstream partners, other ISP peers, and upstream providers.

ISPs have a choice when it comes to connecting to the global Internet. They can either purchase IP Transit or peer with other ISP networks. Peering requires that both ISP parties be provide access to downstream networks and traffic destinations that are of mutual business benefit and in equal proportion. Buying IP Transit from an Internet Transit Provider is a business necessity for ISPs who can't meet their traffic delivery needs via peering, in order to offer full Internet access to their downstream customers.

IP Transit Provider Business Model

Transit Providers offer IP transit services using these business practices:

• IP Transit is typically a metered service. A customer pays for the IP transit service, and the Transit Provider takes care of all its traffic needs. The unit price for IP Transit services varies widely, but the service itself is typically priced on a per-megabit-per-second (Mbps) basis, metered using the 95th percentile traffic sampling technique.
• IP Transit can include Service Level Agreements (SLAs). With these SLAs, the user experience is consistent. To offer a SLA, the ISP must be able to determine the level of service that they can consistently deliver to their customers.
• IP Transit contracts have a specific term. The customer can decide to terminate the relationship when the contract term expires. Transit providers often offer large volume discounts based on negotiated commitment levels.

IP Transit Routing

IP Transit Providers advertise the routes for any customer network to the rest of the Internet, and in turn advertise routes to the rest of the Internet to their downstream transit customers.

ThousandEyes Network Intelligence technology addresses many of the visibility challenges associated with both consuming and delivering IP transit bandwidth connectivity. To assure optimal delivery of applications and services and the highest user experience, organizations relying on ISPs for Internet transit need detailed and accurate global network path visibility, along with BGP routing and application layer performance insights. For more information on how ThousandEyes can help monitor transit across the Internet for users accessing customer-facing apps or employees accessing SaaS and public cloud-based business applications, visit the ThousandEyes ISP monitoring solutions page.