ContractsProf Blog

Editor: D. A. Jeremy Telman
Valparaiso Univ. Law School

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Monday, October 10, 2005

Blackouts from Internet Contract Disputes

Most of us, I suspect, are fairly limited in our knowledge of exactly how the Internet works.  We understand vaguely that there are a bunch of computers connected together, but that's about it.  When we hear talk about "backbones" to the Internet, our eyes glaze over.  Well, at least mine sometimes do.  But, it turns out that there are contracts called "peering agreements" between large Internet companies, that give us the degree of connectivity we have.  A peering agreement is where two or more companies agree to connect directly, thereby creating "short-cuts" for lots of online traffic.  This story from news.com details the fragility of the Internet which is exposed when disputes arise in these peering agreements.  Money has not traditionally exchanged hands in these peering agreements, but some backbone companies are now demanding compensation, when the relative traffic between the two companies becomes disproportionate.  Future disputes could greatly affect the quality of the Internet experience for many.

[Wayne Barnes]

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