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Real-time Bandwidth Trading Comes to Europe

By John Lewell

[London, ENGLAND] Bandwidth trading exchange Arbinet-thexchange announced Wednesday the opening of a direct connection center in London that will enable European telecoms carriers to trade bandwidth online.

There will be plenty of choice, as members of thexchange include over 100 of the world’s top telecoms companies. Now, European operators will get all the facilities enjoyed by their American counterparts, such as dynamic, real-time pricing, automated credit risk management, centralized, automatic billing for all parties, and the elimination of the time-consuming negotiations that took place when everyone still traded bandwidth the old-fashioned way.

Physically based in Central London, the London Exchange Delivery Point (EDP) provides immediate access to major fiber carriers. At present, seven European carriers are members of thexchange, but a connection with the New York EDP adds more than 93 other members from other parts of the world.

Curt Hockemeier, Arbinet-thexchange president and chief executive, said the new London EDP would give carriers the choice of interconnecting with thexchange’s physical delivery infrastructure in either London or New York.

“They can buy and sell, deliver and settle transactions for telephony capacity with thexchange’s 100 plus existing members from either location. This expansion makes it easier for members to join and enjoy opportunities to increase revenues and reduce costs by trading on the world’s only full-service automated bandwidth exchange,” Hockemeier said.

Over US $30 million has been put into Arbinet-thexchange to implement the bandwidth trading solution. Having found acceptance in the demanding New York market, the company has now embarked on the introduction of the service worldwide.

Like oil or cocoa beans, telephony bandwidth is a commodity — but is measured in minutes rather than barrels or tonnes. The total global market for it is calculated (by Arbinet-thexchange) to stand at US $706 billion in 2000.

The good news for consumers is that prices are falling, a trend which, in the view of Arbinet-thexchange, is further encouraged by cost-cutting, automated trading.

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