Legality of SEACOM’s peering decision questioned

SEACOM’s decision to move from an open peering policy to selective peering, and cut off numerous ISPs in the process, has come under fire from industry players.

Apart from being criticized for its about-turn on free and open peering, the legality of its new selective peering policy is being questioned.

Cybersmart CTO Laurie Fialkov said the Electronic Communications Act (ECA) states that peering should be done on a non-discriminatory basis.

Fialkov said that many years ago Telkom and Internet Solutions had the freedom to have discriminatory peering policies because there were no regulations which prohibited it.

This has now changed, he said, and SEACOM’s new peering policies may well “flaunt the regulations”.

He argues that the ECA requires a set of objective and documented criteria to ensure that a company is not discriminating against any company in its peering decisions.

“For SEACOM to pick and choose who they are prepared to peer with subjectively is definitely against regulations,” said Fialkov.

Legal opinion

Electronic communications legal, policy, and regulatory specialist Lisa Thornton told MyBroadband the regulations provide as follows.

Non discrimination (1) The parties to an interconnection agreement must not unfairly discriminate in the negotiation, conclusion and implementation of such agreement, unless otherwise requested by the interconnecting party.

(2) Requests from an interconnection seeker, including requests for additional interconnection in terms of an already concluded interconnection agreement. must be dealt with in the order in which they are received; and

(3) An interconnection provider must apply similar terms and conditions, including those relating to rates and charges, in similar circumstances to itself. affiliates and other interconnection seekers, providing similar services, unless otherwise requested by the interconnecting party.

Thornton said SEACOM will argue that the networks that it no longer is willing to peer with (settlement-free networks) are not comparable to its own.

“And, of course, others will argue that they are the same – same licences issued by ICASA allowing them to provide the exact same services (iECNS and iECS), providing similar services,” said Thornton.

Expert opinion

ICT policy and regulation expert Dr. Charley Lewis told MyBroadband that SEACOM’s refusal to peer for free with certain ISPs is anti-competitive and an abuse of dominance.

“The key question here is whether Internet peering falls under the definition in the 2005 ECA of interconnection, which is historically a telephony or voice concept,” said Lewis.

“But the ECA aims to be technologically neutral, and speaks of the ‘physical or logical linking’ of ‘electronic communications networks’ or ‘electronic communications services’”.

He said this clearly includes the interconnection of Internet networks and services at a peering point.

The ECA also aims to ensure “service interoperability, non-discrimination and open access” of interconnection in the public interest.

“Further, interconnection agreements are required to be non-discriminatory as among comparable types of interconnection,” said Lewis.

These provisions are carried through into ICASA’s Interconnection Guidelines, which explicitly include “digital switching centres” and “Internet exchange points” in the list of possible points of interconnection.

Although any operator that has been found “not to have significant market power” is exempted from these provisions, it’s important to note that all operators are by presumption included unless explicitly exempted.

“As far as I know, no such finding has been made in respect of SEACOM,” said Lewis.

“Surely, then, any ISP seeking to peer with SEACOM on the free terms and conditions applicable to the major ISPs simply has to file an interconnection dispute with ICASA.”

Lewis said SEACOM’s refusal to peer for free with specific ISPs is anti-competitive as it cannot be good for competition, consumer value, and choice.

“One would hope that ICASA will deal any such interconnection dispute filed by one of the affected ISPs expeditiously and in the public interest,” said Lewis.

ISPA’s view

MyBroadband asked the Internet Service Providers’ Association (ISPA) for comment regarding its views on open peering, and it provided the comprehensive response below:

In general terms, interconnection between two licence holders is dealt with by the Interconnection Regulations published by ICASA in 2010. In practice, ICASA has not gotten involved in peering agreements between ISPs, and has focused on voice interconnection (and SMS to a limited extent). That said, the ICASA regulations contain some sound principles equally applicable to peering between ISPs.

Requests for interconnection need to be financially feasible and technically feasible, which broadly means that they must not have a negative financial impact on the peering partner or a negative impact on the ISP’s network. In case of a dispute about the feasibility, ICASA can decide on a case-by-case basis.

Equally importantly, interconnection must be on a non-discriminatory basis. This does not mean that ISPs are obliged to offer free peering to all other ISPs. Rather it means that the same peering policies have to apply to anyone asking for peering. For example, if an ISP determines that they will only offer free peering to another ISP which reaches a certain traffic volume, then that rule needs to be applied consistently to anyone requesting peering.

ISPA strongly supports both non-discriminatory peering, and the rights of ISPs to determine their own peering policies. ISPs need to be able to make decisions about their peering policies that are in their best commercial interest. The vibrant competition in the Internet sector means that peering tends to naturally trend towards efficient policies that benefit consumers.

ISPA also notes that there tends to be some confusion between transit services and peering. An operator offering a transit service is paid to carry traffic from a customer’s network across the operator’s network and onto other third-party networks. Peering is generally more limited, providing the peering partner with access to content (and customers) located only on the ISP’s network.

There may also be a fee associated with peering. ICASA’s regulations provide for a billing and settlement procedure in an interconnection agreement. Each ISP invests in its own national (and international) network footprint. ISPs with networks of similar sizes and similar geographic scope will generally exchange traffic on a settlement-free basis, because there is a mutual benefit. Some ISPs limit the scope of settlement-free peering to ISPs or a certain size, or who have certain traffic levels.

No comment from SEACOM

MyBroadband asked SEACOM for comment regarding its peering decision, but the company said it “would like to decline to comment on these questions and any others on this topic”.

Now read: SEACOM cuts off ISPs in new peering policy

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Legality of SEACOM’s peering decision questioned