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*preroll music*

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Swiss German would be an option for me.

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English, because you know the
Swiss don't speak proper German.

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My six year old digital native
is telling people rather proud

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that his Dad invented the
fastest internet in Switzerland.

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It’s called Fiber7.

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*applause*

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Thank you.

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While we went to Greece for vacation, I
was in a target conflict, because I had to

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explain him why he couldn’t watch YouTube.
I mean Greece, you know it’s maybe a bit

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difficult, but as a matter of fact, here
in Hamburg it’s not any better. I’m next

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door in the hotel InterCity and they offer
“free WiFi” with 256 kbit/s. If you want

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5 Mbit Internet, you pay 8 Euros extra,
per day. So this is where we are in 2015.

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A few words about me: I’m married, one son
as I said. He was born 2009. He was able

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to unlock the iPhone with the age of 17
months. No one showed him how. My early

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connection with digital techniques was
about 1978 when I was playing with these

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chips 7400. Who knows them? Raise your
hand. Few, thanks. Later on I did an

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apprenticeship as a Fernmelde- und
Elektronikapparatemonteur. And I started

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to do IT business about 1991. And 1996
– almost 20 years ago – we started with

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Linux stuff. My first Linux was Suse 4.2.
In the year 2000 we started with Init7

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and later on I became president of the
SwissIX association. This is an

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association which runs a Internet
Exchange. I had also my time in a startup

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called Zattoo. It’s a network architecture
OTT IP Television. Besides, I need a

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hobby, so I’m also a politician for the
Social Democrats in my city parliament,

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already 8 years. Then I started with the
other hobby, Fiber7 as you know. Oh

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besides, I was also working in an internet
expert group of the Social Democrats

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Switzerland. The internet paper was
adopted earlier this month by the national

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Delegiertenversammlung. I don’t know what
this is in English. So, Buffering sucks!

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Ladies and Gentlemen, this talk is not
about Deutsche Telekom. It’s not about

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peering. It’s not about interconnection.
It’s about these thousands and millions

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of youngsters out there which want to
watch YouTube in HD resolution without

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buffering. So let’s quickly look at the
reason why YouTube and all the other video

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buffers. It’s usually lack of bandwidth.
If you have a 2 Meg DSL or if you have

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an InterCity free WiFi with 250 kilobits;
so HD video is not possible. Sometimes

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they have old PCs, so CPU power is an
issue – these days no longer relevant.

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WiFi quality sucks sometimes. This is
rather an individual issue. And sometimes

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we have an over-subscription of the shared
node – mainly in cable networks. Streaming

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source can be too far away. If you stream
from the U.S., it doesn’t really go well.

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That’s why we have so many CDN, Content
Delivery Network systems, close to the

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end users. Then adaptive streaming can be
an advantage, but also disadvantage. You

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cannot turn it off. When you watch HD and
the connection sucks you just cannot keep

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it on HD. It just drops to SD or lower
resolution. It works, yes. But Claire

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Underwood in low res is not so cool.
Routing algorithm issues – sometimes it’s

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a mismatch of client and server. If your
client is assigned to the wrong CDN

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server, then it’s also slow. Anycast
routing is a trick sometimes. Last but not

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least and the most important thing: It’s
over-subscribed interconnections. We go

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back quickly to the old days. The caller
pays. When you call your mother-in-law

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and you talk with her – well, she talks to
you for 45 minutes and you say hello and

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goodbye – you still pay the call.
*laughter*

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So with YouTube it’s not any different.
You click YouTube and then YouTube talks

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to you for hours maybe and then you say
goodbye, basically. So is the broadband

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customer calling the YouTube server or is
it vice versa? Is the YouTube server

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calling the broadband customer? Probably
it’s the broadband customer who calls.

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But still the data is flowing from the
server to the client. But the client is

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causing the traffic, because he is
requesting the traffic. And if we look at

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the structure of the internet, we have
basically the end user to the right. We

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have – here is the provider network and
the end user is only connected to the

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provider’s network. On the left side we
have all the content in the internet.

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We have the media and video and streaming
and Torrent and you name it. But there is

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always only one way going to the end user.
It’s the yellow marked interconnection

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points and there is no way around them.

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This basically means, the provider
can monopolize the end customer.

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At least as long [as] he is
connected or subscribed.

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There is no alternative way.
So this gives the provider

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a position of power. On the other hand

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these interconnection points used
to be – for a long period of time –

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so called Zero Settlement interconnections
and they are basically the foundation of

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the internet. Without Zero Settlement
peering, without interconnection the

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internet wouldn’t exist as we know it.
The broadband provider, mainly the

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incumbent, the ex-monopolist, or large
cable operators, they tend to become

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more and more restrictive to provide
sufficient interconnection capacity.

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Not upgrading interconnection to the
requirements is very common these days

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and it’s a passive aggressive
behavior. So many providers

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– to name a few: Deutsche
Telekom – they just do nothing.

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They just wait. And the end customers
are suffering. Buffering is very common,

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especially during prime-time.
This is basically what the topic of…

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…the main topic of this conference is:
It’s a gated community. The provider

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creates a gated community
for his own end customers.

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So as I said before: The data
is flowing from the server,

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from the video server to the end customer.
It’s about 50 times more traffic

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flowing to the client and the
usual traffic ratio we have

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for a broadband provider is 1:5
or 1:10. So they’re pulling about

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10 times more traffic
towards the end customer.

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Then we have this interconnection
policy. So they don’t do anything.

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As I said before, they just
over-subscribe the existing

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interconnection. And if you want to
upgrade you have to have a traffic ratio

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of about 1:1.5 to 1.3. But no video
stream service can deliver traffic and

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also maintain the traffic ratio. No
content provider can. So all they can do

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is: They can pay money to get upgraded.
And if they don’t pay, data is stuck in

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congestion and the clients are suffering,
seeing the buffering sign. Large broadband

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providers, such as the incumbents and
cable providers, they want to get paid

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twice. They are able to force the money
due to the temporary monopoly – as I

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explained. And they can ask money from the
end customer and on the other hand also

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from the content. This is called double-
sided market. And if they don’t pay, the

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content is not paying, this is what we
see. And sometimes – as a side note – the

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end customer pays, but still sees this.
But IP interconnection would be cheap.

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The business cost per broadband customer
is just a few cents per month. And if the

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provider would invest this, people would
be happy. On top content providers are

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easy to deal for peering or provide cache
servers etc. So please talk to our

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community fellows of Akamai, Apple,
Amazon, Facebook, Google, Limelight,

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Netflix. T is not Telekom, it’s Twitch.
And Zattoo and a lot of others. So traffic

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congestion is costly. I took a random
Google search and was looking for how much

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traffic is actually costing. And “Die
Welt” showed the result: “Staus kosten

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in jedem Haushalt 509€/Jahr”.

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So my assumption was: If traffic
jam is costing money, then

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probably data traffic jam is also
costing some money. But I figured that no

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one was really exploring that field, yet.
So I thought I’m going to do a little

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“Milchbüechlirächnig”
*laughter*

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*applause*
When I was a child, the milk man came

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every morning and we just put our order
into the Milchbüechli and he put the milk

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into the box outside of the house. By the
end of the month, we went to the shop

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and paid our Milchbüechlirächnig. So this
is my quick calculation: We have about 30

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million broadband connections in Germany.
I assume that everybody is waiting for one

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minute accumulated while watching Netflix,
YouTube, whatever. Probably this is far

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too less. Who thinks one minute is fine,
or – who thinks one minute is not enough?

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Oh, ok, so let’s stick with one minute for
the calculation. And I also assumed that

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5€ / hour waiting is a good salary. If you
think, 5€ is not enough, you can adapt the

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calculation. This is called
“Reservationslohn”. I have no clue what it

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means, but this was on Wikipedia, for
time when you take a job or refuse a job,

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how much would be the value for the
spare time. So this is my calculation:

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If you wait one minute per day, this is
6 hours per year. If you multiply this

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with the 5€, every broadband
customer would lose 30€ per year.

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This sums up – with 30 million
broadband subscribers –

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to 900 million Euros per year. This is the
economic damage in Germany per year.

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*applause*

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As we can assume that a large part of the
buffering is caused by the insufficient

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interconnection, especially during prime-
time when everybody wants to watch

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Netflix. This is also a result of
the restrictive peering policy

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of the incumbent and large cable operators
and the ability for them to force

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some extra money out of these double
sided market power as I explained.

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They probably would gain a few millions.
I don’t have exact figures but I assume

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it’s probably some 10..20..30
millions per year, they could force

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through this market power. On the
other hand we have the damage

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of 900 Million Euro per year and I mean
this is like a – how do you say that? –

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imbalance. So my conclusion in democratic
countries like [in] Western Europe:

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The economic gain of a multibillion
company at the expense of

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the general public is commonly not
tolerated. The next question is basically

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following the previous talk of Thomas:
When will the regulators wake up and force

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every market participant to cooperative
peering and interconnection because the

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end user is suffering, the public is
suffering. Zero Settlement peering – as I

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explained – is rather common. Of course
the “Deutsche Telekom Lobby” would tell

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otherwise, this is clear. The unbalanced
traffic should no longer be used to refuse

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peering; and also disputes about the
interconnection should be resolved rather

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quick. My case against Swisscom is taking
years already and still no end and no

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light at the end of the tunnel. Then, last
but not least we should have broadband

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providers, must be committed to the
interests of their own end user customer

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base. As I said, Telekom managed to get
paid twice because of their market power;

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and other Telecoms, such as Telecom
Hungaria or Swisscom, they use Deutsche

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Telekom and their market power as a
leverage to force their also restrictive

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peering policy; and the regulators so far
don’t do much. I quote here Marc Furrer,

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this is the chief of ComCom Switzerland:
“Nur ein fauler Regulator ist ein guter

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Regulator”.
*laughing*

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Thank you! Questions?
*applause*

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Herald: Okay, thank you Fredy; and let’s
have Thomas back up on stage and we’re

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gonna take questions, please. There is
actually more than the mics I said before,

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there is 2 right up on the top and there
is 3 in each aisle. So if you please

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line up if you have any questions and ask;
and please speak into the mic, we need

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your questions on tape, and those who
are leaving now: Do it silently please.

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Okay, first question, over there!
Q: I have a question for Thomas:

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From your talk it sounds like you did a
lot of work. Can you tell us a little bit

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about the budgeting, that goes
into having a team like that?

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T: Yeah, so, SaveTheInternet
is a coalition of 12 NGOs

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which have all their independent budget.
There is no fixed budget for the work

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that we have been doing as a whole.
All of them have transparency reports.

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So I can not really speak for the
budget of EDRI or accessnow.

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The organization where I am
based in Austria got a grant from the

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media democracy foundation from 10.000€
and money from Netflix, 10.000€ also; and

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we used both for development and paying
for the Faxes. Because in the second run

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of the Fax tool the provider that it
was referring to was no longer paying.

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Otherwise the funding in general about
Digital Rights in Europe is awfully low.

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So if you compare it to the U.S. where you
had double-digit millions going into the

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lobbying it is ridiculous what resources
we have here in Europe; and we are

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thinking about making a donation tool for
the new SafeTheInternet; but again that’s

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complicated because you have 12 NGOs
with very different activity scales. Like

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some of them do a lot, others not so much.
So how would you divide the money?

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These are unresolved questions, that we
are working on right now. If you wanna

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support us with independent
funding, then just donate to the

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individual organizations.
EDRI, Initiative für Netzfreiheit,

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are probably the ones I would mention
most, because they have done

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most of the work; accessnow as well,
but they generally have a lot of funding

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from the U.S., so I don’t think
they need it that much.

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Q: But to summarize, I saw a picture of
your team. I saw all the work you did.

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You did that for 20.000€?
T: No. I never got a Cent. I was paid by

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EDRI for 4 months when
I was working in Brussels

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within BEREC for the first reading;
but otherwise this was mostly free

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time. I got my expenses covered for travel
but other than that I am doing this in my

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spare time. Also now unemployed…
*applause*

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I work for Data Protection NGOs, so they
are allowing me to do a lot of my stuff

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also for Net Neutrality.
Herald: We’re all elephants. We do it

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00:20:54,290 --> 00:21:00,430
for peanuts. Okay, No.1 go ahead!
Mic 1: Yeah, hello! Hi Thomas, thanks a

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00:21:00,430 --> 00:21:07,430
lot for your work, that’s great. I have a
question about the involvement of the

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Business Angels and the companies:
What is the reason, what do you think why

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they came so late into this discussion in
Germany. What probably can we do to change

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this in the future because I think that’s
a… they are great allies in this fight.

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Thomas: That’s… you’re asking exactly the
right question. Sadly in Europe you have

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no organized voice for Startups
or for SMEs when it comes

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to Digital Rights issues; and you would
have to work with them to get them

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00:21:42,050 --> 00:21:45,460
involved in the debate. They were really
late to the party and then, again,

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mostly activated through
U.S. networks. So the

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connection between the civil rights scene
here and the business scene, particularly

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the one which is organized in Brussels
with European umbrellas is very weak. So

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everything you can do there to
strengthen this connection would be great.

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But I don’t have those business contacts.
I got a few people involved in the first

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reading stuff but we definitely need more
people that act as multipliers to get more

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companies involved, particularly now when
we enter into a new phase with the BEREC

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guidelines. We no longer need the loud
arguments of many people, we need more the

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arguments from the business side, from the
universities, from those people who run

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networks. These arguments are better
suited to make a difference with the

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regulators.
Fredy: And to add: Don’t underestimate

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the influence of the lobbies, of the big
names, the Telecoms and the liberty

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globals, they have a lot of money and they
try to influence the politicians as good

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as they can. They do a good
job from their perspective.

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Thomas: You can be sure that the Telecoms
will have people for all 28 regulators,

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now continuously lobbying for an upcoming
9 months. The question is: Who is in our

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team?
Herald: Okay. Thank you. Is there a

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question from the internet?
Signal Angel: Yes, there is a question,

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it is: Whether peering providers should
differentiate between virtual private

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network traffic and public traffic and
where is the line between internal network

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and the public internet?
Fredy: What should I say… this is

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difficult question, I mean… Basically, if
you all commit your backbone then

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there is always plenty of traffic… or
plenty of capacity. So there is… there

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shouldn’t be any differentiation. Networks
should provide enough capacity and then

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we’re good. A common argument from the
big names: “Oh we are investing millions

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and millions and millions in broadband
expansion” but unfortunately they stop

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investing right at the end of their own
backbone so they don’t invest any money

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beyond their little percentage of the
total investment for their interconnections.

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Herald: Okay, there is another question
at No.1?

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Mic 1: I have a question about buffering:
So the most of the content in the web is

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delivered over TCP/IP and… will changing
the media to something like UDP which has

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lower overhead over TCP/IP;
will that change the situation?

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Fredy: Not really.
Mic 1: No?

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Fredy: No. It won’t help. I mean packet
loss is packet loss regardless whether it

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is TCP or UDP.
Herald: Okay, that was a short answer. Next

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question please. Please talk into the mic.
Mic: So when I came here, this year,

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I had the impression that at digital
subscriber line connections not only

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bandwidth is bad but also the ping gets up
way high. Of course – I mean – at home I

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have Fiber7 nowadays so I just thought
I got spoiled by fiber connections but I

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noticed that ping times went up from,
well, couple of years ago 60-80ms from

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sites in your neighborhood more or less
to nowadays 80-160ms. Where is the

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problem there?
Fredy: Well the latency is directly

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related if the provider is not delivering
enough bandwidth, then ping goes up

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that’s a normal behavior of TCP.
Mic: So the problem is also at the

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interconnection sites?
Fredy. Probably yes, most likely, you

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can find out if you do traceroute, then
you see where… well, there is a long

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presentation how to interpret traceroute
properly. If you look for “Nanog traceroute”

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you should find this lecture. But that
would probably give some indication.

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Mic: Alright, thank you.
Herald: Thank you. Next question from

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the internet, just in between and
then we’ll go back, go ahead.

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Signal Angel: “Is Netflix a gated
community by itself?” and “Are you sure

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that their interest will align with the
movement of net neutrality in the long

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run?”
Fredy: We should differentiate between

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Netflix content and Netflix interconnections.
So for the content I probably

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would say: Yes, but I am not the expert.
This would be then layer 7 in the OSI

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model. I am talking here on layer 3, this
is content agnostic. Netflix, they are one

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of the good guys because they really help
to deliver the packets. I know them

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personally a few fellows from the peering
community. They are the good guys,

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definitely.
Thomas: Just also to answer this question

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for the European debate, Netflix was one
of the good guys in the U.S. and they also

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supported of course the European movement.
But again, they are so big that I wouldn’t

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really trust them as an ally because they
could also pay, they could also survive in

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a double sided market and for them in the
growing emerging markets like Europe where

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they just have started, it’s probably
risky to allow for this new type of anti

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net neutrality business models; but in the
consumer side where net neutrality is seen

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as an end user issue I think so far their
interests mostly align. On interconnection

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they have their own interests of course.
Fredy: So I can say: Netflix is

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definitely paying Deutsche Telekom
otherwise no single Deutsche Telekom user

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would be able to watch any
movie on Netflix! So! For sure!

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Herald: Okay, we are short for time
so please, last 2 questions. No.2

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first. Keep it short please.
Talk into the mic.

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Mic 2: Regarding the first talk: What is
the… do you have an explanation for the

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behavior of the European Commission
in behave of the net neutrality debate?

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I especially think of the behavior of
Günther Oettinger who repeatedly said his

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ridiculous lie of a “net neutrality kills”
and he repeated it again and again

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even if there was no reason behind
it. And do you have an explanation for

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this behavior of the Commission
and Junker and this.

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Thomas: For that argument, we had this
great YouTube video “net neutrality kills”.

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If you search it you will find it or
“Netzneutralität tötet” in German. That

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deconstructs this argument of Oettinger.
But in general, and you can go back to the

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previous commissioner Neelie Kroes that I
showed. Our sole suspicion is that the deal

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was that the telecom industry has to give
up a little bit of their profits when it

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comes to Roaming, but on the other
side they gain a lot of future profits on

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the abolishment of net neutrality and so it
was like “Okay, we need a Populist argument",

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Neelie Kroes also needs a quick win at the
end of her career and this was again like

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you take a little bit there and put it
there for the Telecoms industry. And

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Oettinger is a big industrial favor guy,
he is always for big business.

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Herald: Okay, short for time,
last question, No.1.

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Mic 1: Hi, so what strategy should an ISP
use when their capacity on their backbones

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is fully loaded? Like first-in-first-out
or what is your idea about that, because

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the capacity is limited, so when there is
so much traffic that everything is stuck.

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Fredy: Upgrade!
Thomas: Yes, invest in the network!

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Fredy: I mean, sorry, a 10G port is now
some 3000€ including optic and cross

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connect. It’s not that much. Upgrade!
Herald: Okay, thank you!

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*applause*

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*postroll music*

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