The primary roll of an Internet Exchange Point (IX/IXP) is to keep local Internet traffic local and to reduce costs associated with the exchange of traffic between Content Providers and Internet Service Providers.

The Internet is a network of networks, based on the Internet Protocol (IP).  Internet Exchanges (IXs) have an efficiency role in the infrastructure.  At an IX, the networks of Internet Service Providers (ISPs), telecommunications carriers, content providers, web hosting providers and the like meet to exchange IP traffic with one another.  This exchanging of regional, national and/or international IP traffic is generally known as “peering”.  This mutual benefit is generally established by the type of traffic and routes sent and received.  Participants in the exchange have the option of an open peering policy or a restricted policy to peer with only the other participants they choose.  Open peering policies make sense if you have a lot of content to distribute that is interesting traffic for access networks or if you are a party that wishes to offload as much traffic as possible by peering to decrease traffic that has to be sent via the commercial route (buying transit).