Peering vs Transit: How Internet Exchanges Cut Costs and Latency
Every network connected to the internet reaches other networks in one of two ways: by paying a transit provider to carry traffic everywhere, or by peering — exchanging traffic directly with another network, usually without payment.
Transit
A transit provider gives you routes to the entire internet. It is simple and complete, and you pay for capacity or usage.
Peering
Two networks connect and exchange only traffic between themselves and their customers. Peering usually happens at an Internet Exchange Point (IXP), where many networks connect to a shared switching fabric — in India, these include NIXI and several commercial exchanges in major cities.
Why peering helps
- Lower cost: traffic exchanged by peering does not use paid transit.
- Lower latency: traffic takes a direct path instead of travelling through other networks — sometimes via other countries.
- Resilience: an additional path if a transit provider has problems.
Is it worth it for you?
ISPs, hosting providers and content networks usually benefit quickly, because much of their traffic goes to large content and cloud networks present at exchanges. Enterprises benefit less unless they host significant services.
What you need
- Your own ASN and IP space
- A port at the IXP (or a link to it)
- Peering policies and route filters
- A router able to handle the sessions
We provide transit and help networks connect to exchanges. See our Transit service or plan your peering.
