Peering agreement

A peering agreement traditionally was a “gentlemen’s agreement” between [Internet service provider]]s or backbone providers, which allowed users of one provider to send communications over the other provider's network at no cost.

While these agreements were not a problem in the early days of the Internet] when virtually all [[ISPs were approximately the same size, as time went on, and many new, smaller ISPs entered the market, some of the larger Internet backbone providers did not believe that these agreements were appropriate, since they result in the large provider subsidizing the telecommunications costs of the smaller ISP. In the spring of 1997, Uunet Technologies, Inc. created a furor by indicating that it would no longer honor peering agreements with small ISPs and would charge them for access to its network. Such a course, if adopted generally, would have driven many of the smaller ISPs out of business and could have balkanized the Internet -- creating situations where users of some ISPs could not get access to certain websites on ISPs with which they had no peering agreement.