An IXP is a neutral location where networks can connect to exchange traffic. There are three types of IXPs: transit, wholesale, and retail. Transit exchanges offer connectivity between networks that don’t directly compete with each other. Wholesale exchanges connect networks that compete with each other, and retail exchanges connect networks that aren’t connected to each other.

A company that wants to connect to the Internet needs to find someone else that is willing to connect to them. Both parties will negotiate a deal to exchange traffic. For example, you may pay $1.00 to access the other party’s network, and they may offer you free access for a certain period of time.

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