Trust key for IXPs’ role in driving digital economies

THERE is a certain amount of distrust between Internet service providers (ISPs) as they compete for customers and seemingly have no uniting common interest, but trust within the community is needed to build up local economies.

That was one of the observations to come out of a workshop at the Internet Governance Forum (IGF) being hosted in Istanbul, Turkey.

This is especially important because ISPs have to work together on establishing Internet exchange points (IXPs), the physical infrastructure through which Internet traffic between their networks are exchanged, which are seen as key for developing a digital economy.

Entitled The Role of IXPs in Growing the Local Digital Economy, the workshop aimed to explain the role and importance of IXPs in encouraging the development of local digital content, and acting as a catalyst in the development of the domestic Internet economy.

Among the panellists was Pindar Wong, chairman of VeriFi Limited and past chair of the Asia & Pacific Internet Association, who shared some insights from his own experiences in Hong Kong during the 1990s.

“I believe the Internet is built not bought, and this is especially true for those in the business of providing these services,” he said.

In his view, if a nation wants to drive the digital economy, it needs to have engineers with full command and knowledge of what he calls ‘Internet physics.’

“We learnt through trial and error and via experimenting in Hong Kong [because] within Asia in 1996, it was not clear how one should go about building an exchange.

“That’s why community is so important – there are social benefits to having an operators group that meets regularly to discuss issues and best practices,” he said.

Wong noted that despite intense competition, engineers change companies and “go up or down the stack” in the course of their careers, and trust is built over the years.

“The question is, how do you build engineering trust to build up the local industry? The suggestion of starting an IXP, apart from cost considerations, is a good starting point,” he said.

However, Wong conceded that there is a downside to this, as the Edward Snowden incident has proven.

“If you gather all local traffic at one spot, it’s a good honeypot for mass surveillance. I believe that any equipment that goes into an exchange point must be vouched for by the manufacturer, on the matter of security.

“These things can break trust, which is the most important element in building and driving the economy,” he said.

Edward Snowden is the former contract worker at the US National Security Agency (NSA) who blew the whistle on the agency’s mass surveillance and spying activities.

The unique problem of Asia

Speaking to Digital News Asia (DNA) after the workshop, Wong (pic) said that the Asian perspective is slightly different, mainly due to the nature of people’s trust and relationship with government.

He said he feels that the Internet exchange points being discussed in Asia for the last 15 years have a different slant or objective.

“A lot of South Asian initiatives tend to be driven by government or their regulators in the sense that when markets fail, or ISPs can’t negotiate, the government feels it needs to step in,” he said.

However, he argued that the real capital or metric at stake is not cost savings but rather the trust-building.

“It’s like having children. If they fight all the time and you step in and always mediate disputes, then they’re not going to grow up.

“What we need are mature ISPs to grow up and say ‘Look, cost structure is one thing but there are very different ways to add value to the marketplace.’

“The IXP is a focal point for keeping costs down and it makes sense for everyone to do that, without mandating a maximum or minimum,” he added.

Wong is a big believer in self-initiatives, adding that if ISPs have, or feel empowered, to build an exchange point, they should do so if it is a realistic option.

“However I feel in Asia, the answer to that is ‘No,’ ” he said.

Asked whether there is hope on the horizon, or any indication that the needle is showing some signs of movement, Wong said that it is part of the reason why he and his peers participate in events such as the IGF.

“That’s why we do these sessions at IGF, to educate regulators and share our opinion. We may be completely wrong but the intent is to share with regulators to say ‘Look, this is really what we’re trying to build and your desire to help may actually hinder.’

“There’s a difference between love and tough love, and I’m a believer in tough love,” he added.

[Gabey Goh is one of four journalists supported by SEAPA to cover the Internet Governance Forum 2014 in Istanbul. She is a reporter for the Malaysia-based Digital News Asia, where this article originally appeared.]