Towards an auction-based internet

Towards an auction-based internet

Tinniam V Ganesh  |   January 13, 2012
In the book “Hot, flat and crowded” Thomas L. Friedman describes the “smart homes” of the future in which all the home appliances will have sensors and will participate in the energy auction in real time as a part of the smart grid. The price of energy in the energy grid fluctuates like stock prices since enterprises are bidding for energy during the day. In his smart home, Friedman envisions a situation in which the washing machine will turn on during off-peak hours when the prices of energy in the energy grid is low. In this way all the appliances in the homes of the future will minimize energy consumption by adjusting the cycles accordingly.
Why could not the internet also behave in a similar fashion? The internet pipes get crowded at different periods of the day, during seasons and during popular sporting events. Why cannot we have an intelligent network in place in which price of different data transfer rates vary depending on the time of the day, the type of traffic and the quality of service required. Could the internet be based on an auction-mechanism in which different devices bid for bandwidth based on the urgency, speed and quality of services required? Is this possible with the routers, switches of today?
The answer is yes. This can be achieved by the new, path breaking innovation known as Software Defined Networks (SDNs) based on the OpenFlow protocol. SDN is the result of pioneering effort by Stanford University and University of California, Berkeley and is based on the Open Flow Protocol and represents a paradigm shift to the way networking elements operate. SDNs can be made to dynamically route traffic flows based on decisions in real time. The flow of data packets through the network can be controlled in a programmatic manner through the OpenFlow protocol. In order to dynamically allocate smaller or fatter pipes for different flows, it necessary for the logic in the Flow Controller to be updated dynamically based on the bid price.
For example, we could assume that a corporate has three different flows, namely immediate, ASAP, price below $x. Based on the upper ceiling for the bid price, the OpenFlow controller will allocate a flow for the immediate traffic of the corporation. For the ASAP flow, the corporate would have requested that the flow be arranged when the bid price falls between a range $a – $b. The OpenFlow Controller will ensure that it can arrange for such a flow. The lowest priority traffic will be send during non-peak hours.
This will require that the OpenFlow controller be able to allocate different flows dynamically based on winning the auction process that happens in this scheme. The current protocols of the internet of today - RSVP, DiffServ - allocate pipes based on the traffic type & class which is static once allocated. This strategy enables OpenFlow to dynamically adjust the traffic flows based on the current bid price prevailing in that part of the network.
The ability of the OpenFlow protocol to be able to dynamically allocate different flows will once and for all solve the problem of being able to monetize mobile and fixed line data. Users can decide the type of service they are interested and choose appropriately. This will be a win-win for both the Service Providers and the consumer. The Service Provider will be able to get a ROI for the infrastructure based on the traffic flowing through his network. The consumer rather than paying a fixed access charge could have a smaller charge because of low bandwidth usage.
An auction-based internet is not just a possibility but would also be a worthwhile business model to pursue. The ability to route traffic dynamically based on an auction mechanism in the internet enables the internet infrastructure to be utilized optimally. It will serve the dual purpose of solving traffic congestion, as highest bidders will get the pipe but will also monetize data traffic based on its importance to the end user.
An auction based internet is a very distinct possibility in our future given the promise of the OpenFlow protocol.
Tinniam V Ganesh, is an Infrastructure Architect at IBM India, Global Technology ServicesYou can write to him at and read hisblog

This article represents the author's viewpoint only and doesn't necessarily represent IBM's positions, strategies or opinions



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