Competition Law and Internet Exchange Point (IXP) Competition Issues

1. Introduction

An Internet Exchange Point (IXP) is a physical and technical interconnection facility where Internet Service Providers (ISPs), Content Delivery Networks (CDNs), cloud providers, content platforms and other Autonomous System (AS) networks exchange Internet traffic, generally through peering.

IXPs can substantially reduce transit costs, improve latency, increase resilience and keep domestic traffic within the country. Because an IXP can become an important network node, however, competition concerns may arise where an operator possesses significant market power or where access to the exchange, ports, data centres, fibre connectivity, routing information or peering arrangements is controlled in a discriminatory manner.

The competition-law issues therefore involve market definition, dominance, essential facilities, refusal to deal, discriminatory access, predatory pricing, margin squeeze, self-preferencing, tying, exclusive arrangements, interoperability and regulatory overlap.

The Indian position is particularly significant because the CCI directly considered IXP competition in Extreme Infocom Pvt. Ltd. v. National Internet Exchange of India (NIXI) in 2024. The CCI treated the provision of Internet exchange services as a potentially distinct relevant market and examined whether NIXI possessed dominance.

2. Nature of Competition in the IXP Market

An IXP generally provides:

1. physical port connectivity;
2. switching infrastructure;
3. peering facilities;
4. cross-connection facilities;
5. traffic-exchange platforms;
6. access to participating networks;
7. routing and technical coordination;
8. data-centre connectivity;
9. connectivity between ISPs and CDNs; and
10. access to a network ecosystem or "peering community."

The competitive importance of an IXP comes partly from network effects.

The more networks connected to an IXP:

more participants → more possible peering relationships → greater traffic → greater attractiveness → more participants.

Consequently, an established IXP can potentially acquire a significant competitive advantage over a smaller rival.

At the same time, IXPs may face competition from:

• bilateral private peering;
• Internet transit providers;
• other public IXPs;
• CDN interconnection;
• direct interconnection between networks;
• private interconnection facilities; and
• alternative data-centre-based exchanges.

BEREC has observed that the IP-interconnection ecosystem includes transit, peering and CDN arrangements and that technological developments have increased bilateral peering and on-net CDN deployment.

3. Relevant Market

Under Section 19(5)–(7) of the Competition Act, 2002, the CCI must determine the relevant product and geographic market.

For IXPs, possible relevant-product-market formulations include:

A. Internet exchange services

"Provision of Internet exchange services."

B. Peering services

"Provision of public peering services to ISPs, CDNs and other autonomous systems."

C. Broader IP-interconnection services

The market could potentially include:

• public peering;
• private peering;
• IP transit;
• CDN interconnection.

The correct market depends upon demand-side and supply-side substitutability, rather than merely the technical similarity of the services.

Indian position

In Extreme Infocom v. NIXI, the CCI ultimately delineated the relevant market as:

provision of Internet exchange services in India.

The Commission considered the homogeneous nature of IXP services throughout India and the competitive circumstances presented before it.

This is particularly important because it demonstrates that an IXP can potentially constitute a competition-law market in its own right, rather than merely being treated as an incidental component of telecommunications services.

4. Network Effects and Market Power

IXPs exhibit strong direct and indirect network effects.

For example:

IXP A

• 800 connected ASNs
• 200 ISPs
• 100 CDNs

may be considerably more attractive to a new ISP than:

IXP B

• 50 connected ASNs
• 15 ISPs
• 5 CDNs.

This creates a possible incumbency advantage.

Competition authorities therefore need to consider:

• number of connected networks;
• traffic volume;
• number of locations;
• geographic coverage;
• number of CDNs;
• number of major ISPs;
• switching costs;
• access to data centres;
• availability of alternative IXPs;
• availability of private peering;
• transit alternatives; and
• barriers to establishing competing IXPs.

Importantly, large traffic volume alone does not establish dominance.

The CCI's decision in the NIXI case illustrates this point. Although NIXI had a large national footprint, the Commission considered the substantial presence of competing IXPs and the ability of the informant to expand its own network. The market was therefore regarded as contestable on the material before the Commission.

5. Refusal of Access to an IXP

One of the most important competition concerns is denial of access.

Suppose a dominant IXP refuses:

• a competing ISP;
• a CDN;
• a cloud provider; or
• another IXP

access to its facilities without legitimate justification.

The conduct may potentially constitute abuse of dominant position under Section 4.

The analysis would consider:

1. Is the IXP dominant?
2. Is access commercially or technically indispensable?
3. Are alternative IXPs available?
4. Can the competitor establish another peering arrangement?
5. Would refusal eliminate or substantially restrict competition?
6. Is there an objective technical or security justification?
7. Is the refusal discriminatory?

6. Essential-Facilities Doctrine

The essential-facilities doctrine is particularly relevant to IXPs but must be applied cautiously.

The fact that an IXP is important does not automatically make it an essential facility.

The classical approach requires considerations such as:

• indispensability;
• absence of reasonably effective alternatives;
• elimination or serious restriction of competition;
• feasibility of supplying access; and
• absence of objective justification.

The European jurisprudence in Bronner established a demanding standard for compulsory access to infrastructure controlled by a dominant undertaking.

For an IXP, therefore:

"Important facility" ≠ automatically "essential facility."

This distinction is fundamental.

7. Discriminatory Access

A dominant IXP could potentially favour:

• its own ISP;
• affiliated CDN;
• affiliated cloud service;
• preferred content provider; or
• selected network members.

Examples include:

• faster port activation for affiliates;
• better routing arrangements;
• preferential cross-connects;
• lower port fees;
• better-quality technical support;
• preferential maintenance;
• preferential access to capacity.

Such conduct can raise concerns under Section 4(2)(a), Section 4(2)(c) and related provisions, depending upon the precise conduct.

The competition concern becomes stronger when the IXP simultaneously competes with the undertaking seeking access.

8. Predatory Pricing

Predatory pricing is another important issue.

An IXP may offer:

• free ports;
• free transportation;
• below-cost connectivity;
• heavily subsidised cross-connects; or
• temporary zero-price services.

A low price is not by itself unlawful.

The competition authority would need to examine whether:

1. the provider is dominant;
2. the relevant pricing provision is satisfied;
3. the pricing is below the appropriate cost benchmark;
4. there is a strategy or effect capable of excluding competitors; and
5. the conduct is capable of harming competition rather than merely benefiting consumers.

9. Extreme Infocom v. NIXI — The Direct Indian IXP Case

Extreme Infocom Pvt. Ltd. v. National Internet Exchange of India (NIXI), CCI Case No. 10 of 2023, order dated 20 August 2024

This is the most directly relevant Indian competition-law decision concerning IXPs.

Extreme Infocom, operating Extreme IX, alleged that NIXI was providing IXP services free of charge or at reduced rates in various locations, including by absorbing transportation costs.

The allegations included:

• predatory pricing;
• denial of market access;
• leveraging of financial strength;
• foreclosure of competing IXPs.

The informant relied upon Section 4(2)(a)(ii) and Section 4(2)(c) of the Competition Act.

CCI's approach

The Commission examined the relevant market and concluded that the appropriate relevant market was:

provision of Internet exchange services in India.

It then examined whether NIXI possessed a position of dominance.

The CCI considered, among other things:

• traffic;
• connected networks;
• number of exchange points;
• geographic presence;
• competitors' expansion;
• contestability of the market.

The Commission found that the available material did not establish dominance and therefore did not proceed to a substantive finding of abuse concerning the alleged predatory pricing and denial of market access.

Significance

The case establishes an important analytical sequence:

Relevant market → dominance → abuse

An allegation of predatory pricing or denial of market access cannot ordinarily succeed under Section 4 without first establishing the required dominant position.

It is also significant because it demonstrates that the CCI is prepared to examine IXP services as a specific competition market.

10. Extreme Infocom v. CCI & NIXI — Delhi High Court

Extreme Infocom Pvt. Ltd. v. Competition Commission of India & Anr., Delhi High Court, 24 May 2023

Extreme Infocom separately approached the Delhi High Court seeking directions concerning the complaint against NIXI and the provision of free IXP services.

The proceeding arose during the pendency of the competition proceedings and concerned procedural/interim aspects rather than establishing that NIXI had committed an antitrust violation.

Significance

This proceeding is useful for understanding the procedural dimension of IXP competition disputes in India.

It also demonstrates that complaints involving IXP pricing and access can generate issues before both:

• the competition authority; and
• constitutional/supervisory courts.

11. Competition Commission of India v. Bharti Airtel Ltd.

CCI v. Bharti Airtel Ltd., Supreme Court of India, 2018

Although this was not an IXP case, it is highly relevant because it concerns interconnection in the telecommunications sector.

The dispute concerned alleged problems involving Points of Interconnection and the relationship between competition law and sectoral telecommunications regulation.

The Supreme Court established an important principle concerning regulatory sequencing: where the dispute substantially involves technical and regulatory matters falling within the telecommunications regulator's domain, the sectoral regulator may first determine those issues before the CCI undertakes the competition-law assessment. The Supreme Court nevertheless did not hold that competition law is wholly excluded from the telecom sector.

Relevance to IXPs

An IXP dispute can similarly involve:

• technical routing;
• licensing;
• interconnection;
• network architecture;
• telecom regulation;
• access obligations.

Therefore, the interaction between TRAI/DoT regulation and CCI jurisdiction can become important in India.

12. Bronner v. Mediaprint

Oscar Bronner GmbH & Co. KG v. Mediaprint, Case C-7/97

The European Court of Justice considered whether a dominant undertaking could be required to provide access to its distribution system.

The Court adopted a stringent test for compulsory access, emphasizing:

1. indispensability;
2. absence of an actual or potential substitute;
3. elimination of competition; and
4. lack of objective justification. 

Application to IXPs

A competitor cannot simply argue:

"This IXP is more efficient than alternatives."

It would need to establish something substantially stronger:

"Without access to this IXP, effective competition is practically impossible or seriously eliminated."

This is particularly important because multiple IXPs and private-peering alternatives may exist.

13. IMS Health v. NDC Health

IMS Health GmbH & Co. OHG v. NDC Health GmbH & Co. KG, Case C-418/01

IMS Health concerned access to an industry-standard data structure.

The Court developed the exceptional circumstances associated with compulsory access to an intellectual or infrastructural resource. The case involved circumstances where refusal of access could eliminate competition and where exceptional conditions were present.

Relevance to IXPs

An IXP may acquire an industry-standard position if virtually all important networks connect through it.

Competition concerns could therefore arise where:

• the IXP becomes the practical standard;
• competing networks cannot economically reach customers without it;
• alternative IXPs are ineffective; and
• access is denied without objective justification.

14. Clearstream v. Commission

Clearstream Banking AG & Clearstream International SA v. Commission, Case T-301/04

The European Union courts considered refusal to provide cross-border clearing and settlement services and discriminatory conditions in a market involving critical financial infrastructure.

The case is relevant to IXPs because it illustrates competition-law scrutiny of network infrastructure that provides an important gateway between market participants.

IXP relevance

The analogy becomes important where an IXP:

• controls a gateway;
• provides access to a network ecosystem;
• has significant market power;
• discriminates between users; or
• refuses access.

The critical issue remains whether the infrastructure creates genuine competitive dependency rather than merely commercial convenience.

15. Deutsche Telekom v. Commission

Deutsche Telekom AG v. European Commission, Case C-280/08 P

The case concerned wholesale access to an incumbent telecommunications network and alleged margin squeeze.

The Court examined the relationship between:

• wholesale access charges; and
• retail prices.

The judgment confirmed the competition-law significance of pricing practices by dominant telecommunications operators even where regulatory authorities were involved in approving certain charges.

Application to IXPs

A dominant IXP could potentially create a margin-squeeze problem where it:

• charges competitors high wholesale/port/interconnection costs; while
• offering itself or an affiliated downstream business cheaper access.

For example:

Competitor: ₹100 port + ₹80 transport

Affiliate: ₹20 equivalent internal access

could create a competitive disadvantage, subject to the relevant legal and economic tests.

16. TeliaSonera Sverige

Konkurrensverket v. TeliaSonera Sverige AB, Case C-52/09

TeliaSonera concerned broadband access and margin squeeze in telecommunications.

The Court examined whether the relationship between wholesale access prices and downstream prices could restrict competition.

Relevance to IXPs

The same conceptual framework can become relevant when an IXP operator participates at multiple levels of the value chain.

For example:

IXP infrastructure → ISP connectivity → consumer-facing Internet services

If the IXP operator supplies access to competitors while simultaneously competing downstream, competition authorities may examine whether its pricing structure disadvantages equally efficient competitors.

17. Slovak Telekom v. Commission

Slovak Telekom a.s. v. European Commission, Case C-165/19 P

The case concerned access to a telecommunications network, regulatory access obligations and margin squeeze.

The Court addressed:

• regulated access;
• conditions imposed on competitors;
• indispensability;
• pricing;
• margin squeeze; and
• competitive effects. 

Relevance to IXPs

It demonstrates that competition law can scrutinise not merely an outright refusal of access but also conditions that technically permit access while making effective competition commercially difficult.

For an IXP, examples might include:

• excessive port charges;
• discriminatory cross-connect charges;
• unreasonable technical requirements;
• excessive minimum traffic commitments;
• discriminatory latency arrangements;
• restrictive peering policies.

18. Major Competition Issues in IXPs

A. Dominance

Dominance may arise from:

• high traffic share;
• large ASN membership;
• geographic coverage;
• control of strategic data centres;
• access to fibre;
• network effects;
• switching costs;
• reputation;
• technical standards.

But market share alone is insufficient.

B. Refusal to Deal

Potentially problematic conduct includes:

• refusal to provide ports;
• refusal to connect a competitor;
• denial of cross-connects;
• refusing reasonable technical access;
• terminating access without objective justification.

C. Discriminatory Access

An IXP should generally avoid unjustified discrimination concerning:

• port allocation;
• pricing;
• capacity;
• routing;
• latency;
• maintenance;
• service quality;
• technical support.

D. Predatory Pricing

Potential concerns arise where a dominant IXP deliberately:

• prices below cost;
• subsidises ports;
• absorbs competitors' transportation costs;
• provides services for zero consideration;
• selectively gives discounts.

However, free services can also generate legitimate efficiencies and consumer benefits. Low or zero prices are therefore not automatically anticompetitive.

The NIXI case is particularly instructive because the CCI did not reach the predatory-pricing question after finding that dominance had not been established.

E. Margin Squeeze

Potentially abusive conduct could involve:

high access price to competitors + low downstream price by the dominant IXP/affiliate.

The Deutsche Telekom, TeliaSonera and Slovak Telekom jurisprudence provides useful analytical principles.

F. Self-Preferencing

An IXP that operates affiliated:

• ISP services;
• CDN services;
• cloud services; or
• content services

may have incentives to favour its own affiliates.

Possible forms include:

• superior port availability;
• better latency;
• preferred routing;
• preferential capacity;
• faster fault resolution.

G. Exclusive Dealing

An IXP could potentially require members to:

• use only its exchange;
• avoid competing IXPs;
• maintain minimum traffic exclusively through it;
• refrain from private peering.

Such restrictions must be assessed under the applicable agreement/abuse provisions and their actual competitive effects.

19. Interoperability and Peering Policies

An IXP's peering policy is central to competition.

Possible models include:

Open peering

Any qualifying network may participate.

Selective peering

The IXP establishes technical and commercial eligibility criteria.

Restrictive peering

Participation is limited to selected networks.

A legitimate technical qualification is not necessarily discriminatory.

However, criteria become competition-sensitive when they are:

• arbitrary;
• opaque;
• selectively enforced;
• designed to exclude rivals; or
• applied differently to affiliated entities.

20. Data and Information Advantages

IXPs can possess commercially sensitive information concerning:

• traffic volumes;
• network destinations;
• traffic patterns;
• capacity requirements;
• latency;
• congestion;
• participating networks.

If the IXP also competes with its members in a downstream market, access to such information may create a competitive advantage.

Potential concerns include:

• misuse of commercially sensitive information;
• discriminatory data access;
• information exchange;
• coordinated conduct between competing ISPs.

21. Cartel and Information-Exchange Issues

IXPs bring competitors together.

That creates a potential paradox:

The IXP promotes efficient interconnection but also creates a forum where competitors interact.

The IXP must therefore guard against facilitating:

• price fixing;
• output coordination;
• customer allocation;
• market sharing;
• coordinated capacity restrictions;
• exchange of commercially sensitive information.

The IXP itself does not become a cartel merely because competitors use the same infrastructure. The legal question concerns whether the arrangement facilitates or constitutes an anti-competitive agreement.

22. Merger and Acquisition Issues

Competition concerns may also arise if:

• two major IXPs merge;
• an IXP acquires a competing IXP;
• a telecommunications incumbent acquires an independent exchange;
• a major data-centre operator acquires an IXP;
• a cloud provider acquires an IXP.

The authority may examine:

1. traffic share;
2. connected ASNs;
3. geographic overlap;
4. data-centre access;
5. peering alternatives;
6. transit alternatives;
7. network effects;
8. foreclosure possibilities;
9. interoperability; and
10. potential entry.

A merger can be particularly significant where the parties control complementary bottlenecks.

23. Essential Infrastructure and Data Centres

IXPs frequently depend upon:

• data centres;
• dark fibre;
• metropolitan fibre;
• submarine cable landing stations;
• carrier-neutral facilities.

Competition concerns may therefore extend beyond the IXP itself.

For example:

Data-centre owner → fibre → IXP → ISP/CDN

If the same corporate group controls several layers, it could potentially foreclose rival IXPs by denying or worsening access to essential inputs.

24. Regulatory Competition Issues in India

IXPs operate at the intersection of:

• Competition Act, 2002;
• telecommunications licensing;
• TRAI regulatory framework;
• Department of Telecommunications requirements;
• data-centre regulation;
• cybersecurity requirements;
• infrastructure access rules.

The Supreme Court's approach in CCI v. Bharti Airtel demonstrates that competition law and sectoral regulation may operate together but that their respective institutional roles must be respected.

Therefore:

technical regulation does not automatically eliminate competition-law scrutiny, but competition authorities may need to avoid deciding technical questions that properly belong to the sector regulator.

25. Competition-Law Test for an IXP Dispute

A useful analytical framework is:

Step 1 — Identify the service

↓

Step 2 — Define relevant product market

↓

Step 3 — Define geographic market

↓

Step 4 — Measure market power

Consider:

• traffic;
• ASNs;
• connected networks;
• data centres;
• geographic presence;
• alternatives.

↓

Step 5 — Identify conduct

• refusal to access;
• discrimination;
• predatory pricing;
• margin squeeze;
• tying;
• exclusivity;
• self-preferencing.

↓

Step 6 — Assess competitive effects

• foreclosure;
• increased costs;
• exclusion of rivals;
• reduced innovation;
• reduced interoperability.

↓

Step 7 — Consider objective justification

• network security;
• technical capacity;
• congestion;
• cybersecurity;
• reliability;
• legitimate cost considerations.

↓

Step 8 — Consider remedies

• non-discriminatory access;
• transparent tariffs;
• interoperability;
• separation of functions;
• access commitments;
• behavioural remedies;
• structural remedies where legally appropriate.

26. Summary of At Least Six Relevant Case Laws

The first three are particularly useful for an Indian-law answer, while the European cases provide persuasive comparative principles concerning infrastructure access, network effects and dominant telecommunications infrastructure.

27. Conclusion

Competition law relating to Internet Exchange Points is fundamentally concerned with preserving the openness and contestability of the Internet-interconnection ecosystem.

The principal competition risks are:

• dominance created by network effects;
• refusal of access;
• discriminatory peering;
• predatory pricing;
• margin squeeze;
• self-preferencing;
• exclusive arrangements;
• misuse of commercially sensitive information;
• foreclosure through control of data centres or fibre; and
• anti-competitive consolidation of IXPs.

The most important Indian authority is Extreme Infocom v. NIXI, because it directly addresses competition in the IXP market. The CCI's approach demonstrates that the existence of a large network footprint does not, by itself, establish dominance; the authority must examine the actual competitive structure, alternatives and contestability of the market.

The broader jurisprudence from Bronner, IMS Health, Clearstream, Deutsche Telekom, TeliaSonera and Slovak Telekom provides the conceptual framework for analysing whether access to an IXP or related infrastructure is indispensable, whether discriminatory conditions foreclose competitors, and whether pricing arrangements create an exclusionary margin squeeze.

Core proposition: An IXP should not be treated as an