In 2010, IP Transit Loves Tinet, But Not Sprint

July 8th, 2010 by · Leave a Comment

Today Renesys released another of its updates on the state of the IP transit and peering world, charting the top 13 backbones over the first six months of 2010.  These are always a fascinating read, as the trends in quantity of total IP space transited by the top backbones give us a very independent viewpoint from the world of press releases and sec filings.  You can see both short term events and longer term shifts in the balance of power.

Sometimes the trends are subtle, but on this occasion there is an obvious new feature that one doesn't need to squint to spot.  Sprint, which for many years held the top spot and for the past two years has dueled with Level 3 for that honor, has lost some serious ground in the IP transit world.  Renesys puts much of this up to the loss of Tinet as a customer, with that company becoming transit-free, but there were apparently others as well and Sprint apparently may have chosen not to follow the herd down the pricing hill lately - IP transit isn't that interesting a business for most providers.  Sprint has long been carefully managing its capex as it runs its wireline business for cash flow, and I had been somewhat surprised they stayed as high as they had until now anyway.  Level 3 now sits all a lone at the top of the chart, steadily plugging away, but now their nearest neighbor in second place is Global Crossing.

The other trend that Renesys discusses is the rise of Tinet, the reborn global IP network that was once Tiscali's international arm.  Their growth was strong enough to fend of a rising China Telecom, which given bandwidth trends in China compared to Tinet's European base was quite a feat.  They are threatening AT&T's slot now.  Tata has also been doing quite well, whereas traditional powers Verizon, AT&T, Telia, and NTT didn't really see much change.  

This metric probably means more to Tinet than it does to its much larger competition, as a much larger percentage of the company's revenue derives from IP transit.  We don't have details on the company's financials since they are privately held, but they don't seem to be blowing smoke when it comes to their talk of rapid growth.

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