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In computer networking, peering refers to a voluntary interconnection of administratively separate Internet networks for the purpose of exchanging traffic between the customers of each network. A more simple definition of peering is settlement-free or "sender keeps all," meaning that neither party pays the other for the exchanged traffic; instead, each derives revenue from its own customers.

Basically, the relationships between Internet networks are generally described by one of the following three categories.

Transit: Money is paid to another network for Internet access.

Peer: Exchange traffic of networks between each other's customers for mutual benefit.

Customer: Another network pays money for its Internet access.

According to this, any Internet connected network must by definition either pay another network for transit, pr peer with every network who also does not purchase transit.

The bottom line is an inter-network is required for the ISPs in order to achieve interconnection to each other.