Internet Access Dispute Cut Off Some Businesses
Friday, October 14, 2005
Last week, the computers in Barbara F. Buckley's office in the District suddenly went blind to parts of the Internet.
A colleague at the Precursor Group, which analyzes the telecommunications industry for institutional investors, couldn't get online to send out the firm's research. Another couldn't download statistics from a government Web site.
"This is a disaster," Buckley, a Precursor vice president, recalled thinking. "A research firm is really only supposed to do two things and that is create the research and sell it, and we can't do either."
After a day of troubleshooting, Buckley finally found the "culprit." It was a dispute between Cogent Communications Group Inc. and Level 3 Communications Inc., two of the companies that move Internet traffic around the world seamlessly but, in this case, cut off many of their clients from parts of the Web.
Broomfield, Colo.-based Level 3 on Oct. 5 ended its agreement to exchange Internet traffic free with Washington-based Cogent. It cut their link, leaving Cogent clients such as Precursor unable to see parts of the Internet served only by Level 3, and vice versa.
With the Internet as vital to many businesses as the telephone, the incident prompted calls for the government to step in if the industry does not prevent such disruptions on its own.
"Does it require regulation? I think if the industry does not show itself to be more mature -- yeah," said David J. Farber, a former chief technologist at the Federal Communications Commission. He said his natural instinct is to avoid regulation "if you can get more sane solutions from the industry."
Communications experts suggested that companies in such disputes should agree to arbitration, have a cooling-off period during which they cannot cut service and warn all customers of any disruption.
Few customers were warned in advance, leaving many people unable to figure out why they could not access Web sites, use Internet phones or send e-mail.
After customers complained, Level 3 restored its link to Cogent on Oct. 7 and agreed to keep it open until Nov. 9, allowing time to negotiate a new agreement.
Level 3 and Cogent have spent the past week blaming each other.
The dispute boils down to Level 3's claim that it was carrying a disproportionate amount of Cogent traffic and should be paid for it. Cogent said it had sent more traffic to Level 3 but only at the other firm's request. A Level 3 executive said he was not aware that his company had made such a request.
Neither side made provisions to arrange connections with other Internet "backbone" providers, which would have kept all their customers connected after the cutoff.
Level 3 appeared chastened by the experience but said government regulation was not needed because the market policed itself.
"It was the customers screaming that got things going again," Level 3 President Kevin J. O'Hara said in an interview. He hopes not to cut off any customers in the future. "We learned a lesson here."
Cogent chief executive David Schaeffer said the government should step in.
"I am a guy who is anti-regulation. . . . I am also a realist," he said. "There is a place for a regulator to ensure the quality and ubiquity of service."
It is unclear how much of the Internet was inaccessible to Cogent and Level 3 customers. Cogent said as many as 5 percent of Web sites may have been affected, while Level 3 put the estimate at roughly 1 percent.
Depending on the site, any loss of service can be devastating for businesses.
"If you take out one of the legs that holds up the chair, it all tumbles down surprisingly quickly," said Paul F. Ryan of Ulysses Financial LLC, a New York investment banker who lost access to the Groove Networks Web site that he and his colleagues use to track deals, send instant messages and coordinate their work across the country. "You get back to the dark ages of having to pick up the telephone."
It took Ryan two days to get his Groove Networks access back.
"I am trained as a Harvard free market economist and should be spouting the party line that the free market solves everything," Ryan said. "There needs to be government policing authority to stop this from happening because at this point too much relies on it to make it just a decision between two guys having a pissing match."
Some Cogent customers remain angry that they were victims of a commercial dispute between two companies that appeared to have played a game of chicken, with Level 3 threatening to cut off Cogent and Cogent all but daring it to do so.
Buckley said she was considering spending $450 more a month to get a backup provider and was wondering whether to leave Cogent altogether. "I am trying to think of a reason to stay," she said.