I listened to Russell Brown interviewing Raymond O'Brien of Telstra Clear on the Wire today. (Update - audio here). He was attempting to justify their de-peering from the Wellington and Auckland internet exchanges.
It seems to me that as Russell suggested, and Raymond tried to rebut, that if this goes on many NZ sites will move to offshore hosting (like this and 90% of other NZ blogs, incidentally).
I am currently paying around NZD40 annually for a UK based hosting service with PHP,SQL, 10M of disk and 500M of bandwidth - the same service in NZ costs that every month! US hosting is even cheaper.
There are two reasons to use an NZ based host:
- Google base their country mapping on IP address, so that you need to be on an NZ address to be treated as an NZ site. Perhaps if more NZ sites migrate offshore, they will change this to use the domain suffix? Alternatively, I wonder if there is any way to have an NZ IP on a machine which is physically overseas? Perhaps someone will start a "virtual NZ ISP".
- If you are streaming in realtime, like a radio station, you probably need to have the server locally - I'm not sure if streaming software lets you "uplink" a single stream through a client connection and "downlink" multiple streams to the users? If you are streaming individual files, then unless you produce huge amounts of content this is not an issue.
I'm currently setting up an image intensive site (no not that sort of thing!!) and will be putting the text on an NZ server and images in the UK, avoiding the Google issue. Of course, if everyone does this users "offshore" traffic will increase, taking them closer to bandwidth caps - I suspect that once this happens ISPs will come under pressure to lift the caps rather than getting more dollars out of the end user.
Of course none of this would be necessary if we had a regulator who could say to the telcos: "you will peer appropriately if you want to continue offering services in New Zealand".