rfc1272.txt

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Network Working Group                                           C. Mills
Request for Comments: 1272                                           BBN
                                                                D. Hirsh
                                         Meridian Technology Corporation
                                                                 G. Ruth
                                                                     BBN
                                                           November 1991


                    INTERNET ACCOUNTING: BACKGROUND

Status of this Memo

   This memo provides information for the Internet community.  It does
   not specify an Internet standard.  Distribution of this memo is
   unlimited.

1. Statement of Purpose

   This document provides background information for the "Internet
   Accounting Architecture" and is the first of a three document set:

      Internet Accounting Background & Status (this document)
      Internet Accounting Architecture        (under construction)
      Internet Accounting Meter Service       (under construction)

   The focus at this time is on defining METER SERVICES and USAGE
   REPORTING which provide basic semantics for measuring network
   utilization, a syntax, and a data reporting protocol.  The intent is
   to produce a set of standards that is of practical use for early
   experimentation with usage reporting as an internet accounting
   mechanism.

   The architecture should be expandable as additional experience is
   gained.  The short-term Internet Accounting solution is intended to
   merge with OSI and Autonomous Network Research Group (ANRG) efforts
   and be superseded by those efforts in the long term.  The OSI
   accounting working groups are currently defining meter syntax and
   reporting protocols.  The ANRG research group is currently
   researching economic models and accounting tools for the Internet
   environment.

   Internet Accounting as described here does not wrestle with the
   applications of usage reporting, such as monitoring and enforcing
   network policy; nor does it recommend approaches to billing or tackle
   such thorny issues as who pays for packet retransmission.

   This document provides background and tutorial information on issues



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RFC 1272            Internet Accounting: Background        November 1991


   surrounding the architecture, or in a sense, an explanation of
   choices made in the Internet Accounting Architecture.

2. Goals for a Usage Reporting Architecture

   We have adopted the accounting framework and terminology used by OSI
   (ISO 7498-4 OSI Reference Model Part 4: Management Framework).  This
   framework defines a generalized accounting management activity which
   includes calculations, usage reporting to users and providers and
   enforcing various limits on the use of resources.  Our own ambitions
   are considerably more modest in that we are defining an architecture
   to be used over the short- term (until ISO and ANRG have final
   pronouncement and standards) that is limited to network USAGE
   REPORTING.

   The OSI accounting model defines three basic entities:

      1) the METER, which performs measurements and aggregates the
         results of those measurements;

      2) the COLLECTOR, which is responsible for the integrity and
         security of METER data in short-term storage and transit;
         and

      3) the APPLICATION, which processes/formats/stores METER
         data.  APPLICATIONS implicitly manage METERS.

   This working group, then, is concerned with specifying the attributes
   of METERS and COLLECTORS, with little concern at this time for
   APPLICATIONS.

3. The Usage Reporting Function

3.1. Motivation for Usage Reporting

   The dominant motivations for usage reporting are:

          o  Understanding/Influencing Behavior.
             Usage reporting provides feedback for the subscriber on
             his use of network resources. The subscriber can better
             understand his network behavior and measure the impact of
             modifications made to improve performance or reduce
             costs.

          o  Measuring Policy Compliance.
             From the perspective of the network provider, usage
             reports might show whether or not a subscriber is in
             compliance with the stated policies for quantity of



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             network usage.  Reporting alone is not sufficient to
             enforce compliance with policies, but reports can
             indicate whether it is necessary to develop additional
             methods of enforcement.

          o  Rational Cost Allocation/Recovery.
             Economic discipline can be used to penalize inefficient
             network configuration/utilization as well as to reward
             the efficient.  It can be used to encourage bulk transfer
             at off hours.  It can be used as a means to allocate
             operating costs in a zero-sum budget, and even be used as
             the basis for billing in a profit-making fee-for-service
             operation.

   The chief deterrent to usage reporting is the cost of measuring
   usage, which includes:

          o  Reporting/collection overhead.
             This offers an additional source of computational load
             and network traffic due to the counting operations,
             managing the reporting system, collecting the reported
             data, and storing the resulting counts.  Overhead
             increases with the accuracy and reliability of the
             accounting data.

          o  Post-processing overhead.
             Resources are required to maintain the post-processing
             tasks of maintaining the accounting database, generating
             reports, and, if appropriate, distributing bills,
             collecting revenue, servicing subscribers.

          o  Security overhead.
             The use of security mechanisms will increase the overall
             cost of accounting.  Since accounting collects detailed
             information about subscriber behavior on the network and
             since these counts may also represent a flow of money, it
             is necessary to have mechanisms to protect accounting
             information from unauthorized disclosure or manipulation.

   The balance between cost and benefit is regulated by the GRANULARITY
   of accounting information collected.  This balance is policy-
   dependent.  To minimize costs and maximize benefit, accounting detail
   is limited to the minimum amount to provide the necessary information
   for the research and implementation of a particular policy.







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3.2. Network Policy and Usage Reporting

   Accounting requirements are driven by policy.  Conversely, policy is
   typically influenced by the available management/reporting tools and
   their cost.  This section is NOT a recommendation for billing
   practices, but intended to provide additional background for
   understanding the problems involved in implementing a simple,
   adequate usage reporting system.

   Since there are few tools adequate for any form of cost recovery
   and/or long-term monitoring there are few organizations that practice
   proactive usage reporting in the Internet.  Those that do have
   generally invented their own.  But far and away the most common
   approach is to treat the cost of network operations as overhead with
   network reports limited to short-term, diagnostic intervention.  But
   as the population and use of the Internet increases and diversifies,
   the complexity of paying for that usage also increases.  Subsidies
   and funding mechanisms appropriate to non-profit organizations often
   restrict commercial use or require that "for profit" use be
   identified and billed separately from the non-profit use.  Tax
   regulations may require verification of network connection or usage.
   Some portions of the Internet are distinctly "private", whereas other
   Internet segments are treated as public, shared infrastructure.

   The number of administrations operating in some connection with the
   Internet is exploding.  The network "hierarchy" (backbone, regional,
   enterprise, stub network) is becoming deeper (more levels),
   increasingly enmeshed (more cross-connections) and more diversified
   (different charters and usage patterns).  Each of these
   administrations has different policies and by-laws about who may use
   an individual network, who pays for it, and how the payment is
   determined.  Also, each administration balances the OVERHEAD costs of
   accounting (metering, reporting, billing, collecting) against the
   benefits of identifying usage and allocating costs.

   Some members of the Internet community are concerned that the
   introduction of usage reporting will encourage new billing policies
   which are detrimental to the current Internet infrastructure (though
   it is also reasonable to assert that the current lack of usage
   reporting may be detrimental as well).  Caution and experimentation
   must be the watch words as usage reporting is introduced.  Well
   before meters are used for active BILLING and ENFORCEMENT, they
   should first be used to:

          o  UNDERSTAND USER BEHAVIOR
             (learn to quantify and/or predict individual and
             aggregate traffic patterns over the long term),




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          o  QUANTIFY NETWORK IMPROVEMENTS,
             (measure user and vendor efficiency in how network
             resources are consumed to provide end-user data transport
             service) and

          o  MEASURE COMPLIANCE WITH POLICY.

   Accounting policies for network traffic already exist.  But they are
   usually based on network parameters which change seldom, if at all.
   Such parameters require little monitoring (the line speed of a
   physical connection, e.g.,Ethernet, 9600 baud, FDDI).  The connection
   to the network is then charged to the subscriber as a FLAT-FEE
   regardless of the amount of traffic passed across the connection and
   is similar to the monthly unlimited local service phone bill.

   Usage-insensitive access charges are sufficient in many cases, and
   can be preferable to usage-based charging in Internet environments,
   for financial, technical, and social reasons.  Sample incentives for
   the FLAT-FEE billing approach are:

          o  FINANCIAL:
             Predictable monthly charges.  No overhead costs for
             counting packets and preparing usage-based reports.

          o  TECHNICAL:
             Easing the sharing of resources.  Eliminating the
             headaches of needing another layer of accounting in proxy
             servers which associate their usage with their clients'.
             Examples of proxy servers which generate network traffic
             on behalf of the actual user or subscriber are mail
             daemons, network file servers, and print spoolers.

          o  SOCIAL:
             Treating the network as an unregulated public
             infrastructure with equal access and information sharing.
             Encouraging public-spirited behavior -- contributing to
             public mailing lists, information distribution, etc.