Internet Overview
Internet History and Technical Background
How did the Internet develop?
ARPANET (military) [1969 – 1980’s]:
Research sponsored by the US Dept. of Defense, specifically, the Advanced Research Projects Agency (ARPA)
Objective was to link geographically distant computers to allow remote access and sharing of data
Network had to have no single point of failure
How did the Internet develop?
ARPANET (military) [1969 – 1980’s]:
The Internet’s Grandfather, ARPANET, was born in late 1969
NSFNet (academia) [1980’s – 1991]
By the mid-80’s ARPANET had grown into a widespread educational and scientific network
Started to expand to other countries
The backbone of this network (NSFNet) was funded by the National Science Foundation (NSF)
How did the Internet develop?
ISPs and Telcos (business) [1991-2001]
In the late eighties and early nineties, the backbone was commercialised and the Internet has grown exponentially since then

What kind of network is the Internet?
The word “internet�
network = interconnected computers
internet = inter connected networks (archaic :-)
Internet = The Internet

What kind of network is the Internet?
Types of networks
Circuit-based networks
Telephone networks
Power grids
 Packet-based networks
Post Office
The Internet
Packet-based networks
Unlike circuit-based networks, packet networks have no dedicated end-to-end connection
A characteristic of these networks is the unpredictable nature of routing
The post office runs a packet-based network
The Internet is packet-based

Backbone Infrastructure
Copper cable
Fibre-optic cable
Satellite (VSAT)
Basic Internet Protocol TCP / IP
Transmission Control Protocol / Internet Protocol

IP addresses
Numbers – IP addresses
IP numbers currently consist of four 8-bit numbers (e.g.
We are running out of these numbers, hence the introduction of IP version 6
IP -- what version are you using? (version 4)
NAT = Network Address Translation

Higher level protocols
Other protocols
TCP/IP is the basis for moving packets of data on the Internet, but that is all it does
 On top of this, different protocols are run to provide useful services or functions
HTTP = Hyper Text Transfer Protocol (web)
SMTP = Simple Mail Transfer Protocol (e-mail)
POP3 = Post Office Protocol
BGP = Border Gateway Protocol

Domain names
Names versus numbers
Recap: IP addresses (e.g.
Humans are not good at remembering numbers, so domain names were created
 Generic versus geographic
Generic: .com, .net, .org
Special: .gov, .mil, .edu
Little known domains: .int
Country code: .uk, .za, .jp
further split up, e.g.,,

Internet Market Structure
This next section will explore the business structures operating within the global Internet, to get an overview of the economics of the Internet and to identify potential problems with the current models.

Specifically, the objectives are to understand the roles played by different players in the Internet industry:
The Network: Local Topology
Customer connects to an ISP
Connects via telephone lines to an ISP’s network
Temporary (telephone, ISDN) or permanent (leased line) connection
Different types of connections have different speeds
The Network: International Topology
Backbone carriers
Telecommunications companies
Largest ISPs
Major exchanges
Much like in the national situation, Internet exchange points enable like-sized networks to exchange traffic
Examples include MAE-East and MAE-West
Smaller ISPs
Connect to backbone carriers
Pay a transit fee for their traffic to be carried to exchange points
The Money: Who pays?
The customer pays the ISP
Monthly subscription charges or traffic-based charges
What about “free� providers

 The customer pays the telephone company
Telephone bill – call charges and line rental
Highest portion of the cost in developing countries
The ISP pays the telephone company
Rental of equipment and lines
The Money: Who pays?
The ISP pays another ISP
Peering charges, transit charges
Virtual ISP services

The telephone company pays another telephone company
Co-location, transit, interconnection charges

The Money: Problems
Everyone pays the United States
Imbalances in telecommunications charges mean that regional internetworking is not efficient

The Internet has had military, academic and commercial influences
Different media (copper, fibre, wireless) are used
The Internet uses TCP/IP packets
IP addresses and domain names
ISPs operate at several different levels
Many financial relations
Most Internet traffic passes across a the US ‘hub’
Internet Overview
Internet History and Technical Background

South Africa
Egypt (900)
Egypt (pre-paid)
OECD average
ISP charge
PSTN charge
Internet price comparisons (US$)
Based on 20-hours, off-peak use per month
Source: Tim Kelly, ITU, Internet and Telecoms Summit, 2000


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