7. Technical infrastructure of the Internet and how that shapes governance

- Internet underpinned by telecommunications
- Internet governance

Internet underpinned by telecommunications

The telecommunications network, based on circuit-switch-ing, has highly regulated structures. At the national level, each country has a ministry, laws surrounding the use of networks, and in a growing number of cases an industry regulator. There are also overarching international bodies like the International Telecommunications Union (ITU, a specialised agency of the United Nations) and the European Union, which regulate the sector in different ways. Policy is made at these different levels, and stakeholders can make an input into it.

For example, the cost of international telephone calls is met through a regime of bilateral settlements called the international accounting rate system. This is the mechanism for sharing the cost for international calls between the sending and receiving carriers in each country, so that each side pays half of the cost of the international circuit. Because these accounting rates vary from the actual cost of that circuit (this cost has fallen), and given the historic imbalance in traffic between developed and developing countries, this accounting rate mechanism tends to redistribute revenue from the core of the world economy (developed countries) to the periphery (developing countries). As a result, the accounting rate system is no longer the centrally set benchmark for rates that it once was. Where liberalisation has occurred, the market decides.

As it is not feasible for one ISP to maintain bilateral interconnections with every other ISP, and with the growth of the internet, the hierarchical structure described above has emerged between service providers. In this structure, the local ISP (Tier 3) will exchange traffic with a regional or national ISP (Tier 2), which in turn will exchange traffic with a global internet backbone provider (IBP) (Tier 1). A Tier 1 IBP is defined as having its own international backbone infrastructure, which is high capacity fibre-optic or satellite links. With internet traffic often travelling around the world it will typically be routed from a Tier 3 ISP up to a Tier 1 IBP for the main global transport, and then routed back through the other side of the hierarchy to its destination.

Basic technical infrastructure of the Internet

Internet governance

The internet is decentralised, self-regulating and has be-come increasingly driven by market forces. In contrast to the traditional telephone system, it is based on packet switching and has developed outside that system’s highly regulated structures. As it is based on the technical and commercial interactions between a myriad of internet service providers (ISPs), internet economics is like an ecosystem in which the behaviour of each ISP is shaped by the market forces of these interactions. The opportunity for direct policy inputs is therefore much lower, and the most meaningful interventions are those with commercial relevance. However there remain fierce debates over its level of inclusiveness and its overall effectiveness.

The global nature of the internet, and its growth outside of the control of governments, have meant that there is no international internet governing body. The closest thing to international internet governance is therefore comprised of technical bodies, ranging from the engineering side, such as the Internet Engineering Task Force (IETF), to other technical areas such as responsibility for allocating domain names (the Internet Corporation for Assigned Names and Numbers – ICANN), and IP addresses (Internet Assigned Numbers Authority – IANA), or organisations which set generally recognised standards such as W3C. These and other organs of internet governance are discussed in Part 3.

A key example of internet governance in operation is the allocation of Internet Protocol (IP) addresses – akin to a telephone number for each phone, the unique address for every machine connected to the internet. When a user opens a dial-up internet account, the ISP gives it an IP address. Four Regional Internet Registries (RIRs) do this in each region: APNIC (the Asia Pacific Network Information Centre), ARIN (the American Registry for Internet Numbers), RIPE NCC (the Réseaux IP Européens Network Coordination Centre), and LACNIC (the Latin American and Caribbean Internet Addresses Registry). The Africa region is currently served by APNIC, ARIN and RIPE NCC, but a fifth RIR has been proposed for the region called AfriNIC. According to the Internet Society¹
, these RIRs are “not-for-profit, member-based organisations that facilitate the development of consensus-based policies in a bottom-up, industry self-regulating manner in response to the requirements of the many and varied stakeholders in their respective communities. The RIR structure provides service in a fair, responsive, neutral, and impartial manner”.

So the scope for policy interventions is lower with the internet, but because each of the millions of links of the internet are underpinned by the telecommunications infrastructure, decisions made in the telecommunications sector have profound effects over the internet. In particular the tariffs charged by telecommunication companies, and the licensing regime in a given country have direct impact on the costs of the internet and therefore the behaviour of ISPs. This in turn directly affects its cost relative to local incomes and how many people can have access, and is therefore a key area for policy inputs. Indeed, tariffs and the level of liberalisation are closely linked.

The most extreme example is countries where only one ISP has been licensed, and is run by the state. Often closed states, which do not wish their citizens to have access to information, seek to maintain their monopoly for political purposes, so that they can filter or control the flow of information that is available to citizens. In such countries, the ‘internet’ is essentially a single wide area network (WAN), which can be managed and controlled in the same way that a company or school network may wish to prohibit certain type of information (such as swear words or pornography).

Control of internet user behaviour is not limited to official governance structures. There are other aspects of control of the internet which are not strictly governance, but which do play an important part in regulating internet activity, such as laws on the protection of intellectual property, data and consumer protection, the distribution of pornography, etc. Often these do not refer specifically to the internet, but their application to the world of cyberspace is problematic because of the new ways in which data can be transferred. Some of these are discussed in Part 4 of this book.
So the scope for policy interventions is lower with the Internet, but because each of the millions of links of the Internet are underpinned by the telecommunications infrastructure, decisions made in the telecommunications sector have profound effects over the Internet. In particular the tariffs charged by telecommunication companies, and the licensing regime in a given country have direct impacts on the costs of the Internet and therefore the behaviour of ISPs. This in turn directly affects its cost relative to local incomes and therefore how many people can have access, and is therefore a key area for policy inputs. Indeed, tariffs and the level of liberalisation are closely linked.

The most extreme example is in some countries where only one ISP has been licensed, and is run by the state. Often closed states which do not wish their citizens to have access to foreign information seek to maintain their monopoly for political purposes, so that they can filter or control the flow of information which is available to citizens. In such countries, the ‘Internet’ is essentially one single wide area network (WAN) which can be managed and controlled in the same way that a company or school network may wish to prohibit certain types of information (such as swear words or pornography).

Control of Internet user behaviour is not limited to official governance organisms. There are other aspects of control of the Internet which are not strictly governance, but which do play an important part in regulating Internet activity, such as laws on the protection of intellectual property, data and consumer protection, the distribution of pornography, etc. Often these do not refer specifically to the Internet, but their application to the world of cyberspace is problematic because of the new ways in which data can be transferred. Some of these are discussed in Part 4 of this book.

1 See ISOC, the Regional Internet Registry Development Process, Member Briefing No. 10 December 2002 http://www.isoc.org/briefings/010/index.html