I want to start a “meta ISP.”

When you sign up with your ISP, you’re paying for transit. They carry your data from one network to the other.

But now let’s say that I’m a mediocre residential ISP. I buy connectivity from a couple different upstream providers, and use BGP to make sure your data takes the fastest route. This is what most people do. It works.

Let’s further say that you run an extremely popular site, maybe one of the top 100 sites out there. You have a mediocre IT team. You have enormous bandwidth, coming in from three different carriers. You, too, use BGP to make sure that your outgoing traffic takes the quickest route.

So everything works. Traffic flows between the two networks. What’s the problem?

Well, it turns out that you, Mr. Big Site, have some of your core routers in a major data center out this way. And I, Mr. Big ISP, also have a few core routers in that building. This is really pretty common–there’s a (very aptly-named) network effect with transit. When several big guys move into a building, all of a sudden, more people want to be there too. So you get sites like One Wilshire, a thirty-story building in LA full of networking equipment. They’re very confidential about their tenants, but “word on the street” is that every network you’ve heard of, and plenty you haven’t, is in there. (When viewing that picture, by the way, it’s worth noting that these wires don’t go to some secretary’s PC. Each is probably carrying between 100 Mbps and 10 Gbps of traffic between various ISPs and major networks… Also an interesting note to the photo, they supposedly keep an elaborate database and label each wire, so that this huge rat’s nest is actually quite organized.)

Since we’re both huge companies, we’re each paying six figures a month on Internet. But when one of my customers views your site, they go through a few different ISPs, and across multiple states, before it arrives on your network. It’s asinine, but that’s how the networks work.

So we wise up to this. I call you up, and we run a Gigabit Ethernet line between our racks. And all of a sudden, life is peachy. Data travelling over that line–my customers viewing your site–is free. My bandwidth bills drop, and speeds improve, too. This is the world of peering. And, strangely, the mutually-beneficial practice is rarely done.

I think there’s a market for a big middleman here. The last mile (that would be a good book title, if a telecom magnate wanted to write his memoirs) is difficult–running lines to consumers’ homes. Similarly, it’s hardly trivial to become a Tier 1 ISP, a sort of ‘core backbone’ of the Internet. But an intermediary broker? Easy enough to do.

So you’d get space in the major exchanges, and peer with popular sites. Google, Yahoo, MSN, Youtube, Facebook, eBay, Myspace, Amazon, Akamai, etc.