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Interconnection agreement

(also interconnect agreement, intercarrier agreement)

Interconnection agreement definition

An interconnection agreement is a contract between two or more parties outlining the terms for connecting telecommunications networks. Interconnection agreements outline how the companies will exchange data, voice, or video traffic and ensure that the parties have fair access to each other’s networks.

See also: network service provider

How an interconnection agreement works

  • Two parties (e.g., an ISP and a content provider) negotiate and agree on the terms and conditions of the interconnection agreement.
  • The agreement covers technical details (e.g., the type of traffic to be exchanged, routing policies, quality of service requirements, and commercial terms).
  • The parties establish a point of interconnection (PoI), or where the traffic exchange will take place. This location could be physical or virtual.
  • Each party configures its network to route traffic to and from the point of interconnection.
  • The parties exchange traffic according to the terms and conditions of the agreement and monitor it to ensure that the exchange meets the quality requirements.

Examples of interconnection agreements

  • A contract between an ISP and a content provider (e.g., YouTube, Spotify). This interconnection agreement outlines how the provider delivers content to the ISP’s network.
  • An agreement between two mobile network operators. A contract between two MNOs defines interconnection for roaming services (how customers of one MNO could use the other MNO’s network).
  • Transit agreement between an ISP and a transit provider. This agreement outlines how the transit provider carries traffic from the ISP’s network to other networks on the internet.