The primary role of an Internet Exchange Point (IXP) is to keep local Internet traffic within local infrastructure and to the reduce costs associated with traffic exchange between Internet Service Providers (ISPs).
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, webhosters 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, so unless parties have an open peering policy, they will peer with parties of about the same size. 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).