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What is
the difference between
IP Transit and IP peering?

IP transit and IP peering are the two main interconnect relationships that are established between different Internet Service Providers (ISP) when securing full access to the Internet routing table. They form the foundation of all Internet access services. An ISP looking to provide global Internet connectivity to end-users can choose between building their own IP backbone network and peering with other ISPs, or simply just buying global IP Transit from someone that has an already established IP transit network. To achieve the best balance of cost and performance, most use a combination of the two.

Let’s look at the definitions of IP Transit and IP peering.

IP Transit is the exchange of Internet IP traffic where one party pays another for access to a network (and the networks connected to it), that is considered as having the highest intrinsic value (based on a combination of geographical and logical assets). This may, for example, involve access to all, or a larger part of the wider Internet, or a subset of larger/unique end-customers. Where one network has a higher value than the other network, so-called ‘upstream’ IP Transit is purchased by the network with the lowest intrinsic value. IP Transit is a wholesale service, available only to Autonomous System (AS) number owners running the Border Gateway Protocol (BGP). Non-AS owners can also get Internet connectivity by acquiring services such as Dedicated Internet Access, DIA, or IP Connect, without running BGP. The benefits for ISPs are, amongst other things, a reduced capital expenditure risk and lower yearly recurring costs. There is also less administrative overhead.

Peering, on the other hand, is the exchange of IP traffic between networks without the flow of payments (known as settlement-free peering), or for a fee that compensates for any differences in intrinsic network value (known as paid peering). Settlement-free peering agreements are based on two parties having networks of equal intrinsic value and where they are mutually dependent on each other. A peering interconnection requires that routers and other related equipment are installed at the connection points of the peering parties’ respective networks.

  • Public peering is typically used for smaller regional or international ISPs with a need for interconnections with operators and content providers in specific local/regional markets. There is, in general, one distinct peering location (peering exchange) in each country where many companies providing Internet connectivity meet and interconnect their respective networks. These public interconnects are often public information and built over a common interconnection point.
  • Private peering is an arrangement based on common terms which are deemed suitable for both parties. In private peering, both Internet backbone operators agree on a location (or locations) where to interconnect and built using private network connections. All major Tier-1 ISPs use private peering when connecting their networks.

Most ISPs need to buy IP Transit services from some of the largest Internet backbone networks to be able to offer the full Internet routing table to their end users. For some of the more local or regional traffic, they could benefit from traffic exchange at local peering exchange points (also known as IXs). To reach these peering points, Telia Carrier offers a service called IX Connect.

Why Telia Carrier?

  • Telia Carrier’s #1 global IP network powers 65% of global Internet routes and connects you to 95% of US and European end-users within one network hop, providing the highest level of reliability, flexibility, and security
  • We are one of the original Tier 1 networks, connecting billions of end-users to their critical content, applications, and cloud services
  • Telia Carrier provides exceptional customer care 24/7 – since 2014 we’ve been repeatedly recognised at the World Communications Awards for our Customer Experience, and we have a very high NPS score of 44
  • Flexibility-as-a-Service. Our solutions are fully adapted to our customers’ needs and can be quickly adjusted, if business grows and locations change
  • Most of our services are based on a dynamic pay-per-use model where customers are charged for a service when they use it, giving the best value for money

Some technical facts…

  • Our IP Transit has three route options: Global Connect (Global routes), Euro Connect (European Customers and Peers) and Content Connect (Global customer routes)
  • All connectivity options are available in the IPv4 and IPv6 domains, dual stack
  • Secure Internet routing – minimized routing threats from BGP Hijacks and Route Leaks

Technical highlights

Ethernet Topology Telia Carrier Product MEF-defined services









Ethernet over MPLS
High availability with optional end-to-end SLA and CoS
10Mbps – 10Gbps
Global reach with managed Network Interface Device (NID) in >120 countries
MPOP (Multiple Product Support on a single Port)

Security highlights

Solid network security requires full traffic visibility. We offer various monitoring tools to check and maintain traffic performance.

Secure by design
Global managed Customer Premises Equipment (CPE) support for end-to-end control
Near real-time & historical bandwidth usage views
Ethernet-to-Ethernet network performance parameters, including latency in our MyCarrier portal
Dual NOCs situated in secure underground locations
Physical and logical security from design to deployment
Customer Service authentication procedures
Clear customer data handling policies