Internet giant beneath the streets of Amsterdam

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The biggest internet network in Europe can be found beneath the city of Amsterdam. The Amsterdam Internet Exchange – AMS-IX for short – can even lay claim to being the most popular internet hub in the world, in terms of the number of companies linked up to it. Microsoft, KPN, Google and Facebook are among its customers. The secrets of its success are independence and innovation.

Around 475 companies, half of them from outside the Netherlands, have already found the hub. The volume of data traffic it handles is exceeded only by its rival in Frankfurt.

For the first time at the end of last year, Amsterdam broke through the barrier of 300,000 terabytes of incoming and outgoing internet traffic, reaching a peak of 1.5 TB per second. Streaming video is primarily responsible for this spectacular growth.

The main users of the Amsterdam hub are companies that need to send vast amounts of information. For instance, it’s how software giant Microsoft supplies hundreds of millions of customers with monthly updates. Several factors contribute to the success, explains AMS-IX Director Job Witteman. The network was quick to seek out international partners. Meanwhile, the opening up of the European market in 2000 made it possible to operate independently of the government or existing telecom companies.

But most importantly the network is set up as an association, guaranteeing data neutrality. Right from the very foundation in 1997, Witteman points out, that was the guiding principle.

“KPN offered to help set up the exchange and even to provide space for data traffic. Our answer was ‘Thanks, but no thanks’. That was a pitfall we were determined to avoid. We wanted to do things differently and make a genuinely neutral and independent start. We’ve succeeded. And it was the right move to make.”
The network had no intention of copying the US-based market leaders at the time, whose customers were at the mercy of the owners' whims. As an association, Amsterdam gave the participating companies a say in how the network was run. This formula has turned out to be so successful that other internet hubs – established and new – have followed suit. US companies now visit the Netherlands to see how things are done.
Strictly speaking, the differences between a commercial company and this association are limited. AMS-IX also has to make a profit (albeit a modest one) to guarantee continuity. Yet on paper the AMS-IX method seems to make a big difference in the eyes of potential customers, who value its neutrality and the fact that members determine the future.
Neutrality does not mean that AMS-IX is above the law. Witteman insists he has never been ordered to cut off a customer, but reveals that governments do sometimes come asking for surveillance.
“Yes, that happens regularly and we always show them the door. The Exchange is not the right place for that kind of thing. We have no direct links with end users. If you want to catch a bad guy, you don’t intercept him at a crossroads, you go to his front door. Especially when you know exactly where he lives. The situation on the internet is just as simple. We don’t play cops and robbers.”
It’s a policy AMS-IX plans to stick to, even if national security legislation or anti-piracy laws change. Witteman accepts that illegal content is bound to pass through the network at some point, but makes it clear that AMS-IX never looks at the content of its data traffic. That would immediately damage the network’s reputation.
Fastest connections
Being the one of the biggest in the world is one thing; maintaining that position is another. At the World Economic Forum in Davos, Dutch Prime Minister Mark Rutte was complimented on AMS-IX. But he was also given a warning: make sure you don’t lose the advantage. How does AMS-IX plan to stay ahead of the game?
Unsurprisingly perhaps, the answer is constant innovation and responding to new demand: internet phone services (VoIP) and the growth of mobile internet. But it also means working with others to achieve the fastest connections. The Prime Minister might have given the same answers about the city of Amsterdam.
“We take an active approach to increasing our speed. We’re the first Internet Exchange in the world to offer 100 Gigabit per second, and we already have takers. But we also played an active role in standardising this process. That makes us unique, a fact our customers recognise.”
There’s another key factor that makes AMS-IX stand out from the crowd. It’s the first network hub to offer Service Level Agreements (SLAs): if the data traffic does not flow without problems, AMS-IX agrees to pay a fine. It’s a step the competition hasn’t yet dared to take.