Advertisement

Telecommunication Systems

, Volume 52, Issue 2, pp 601–609 | Cite as

A model of network neutrality with usage-based prices

  • E. Altman
  • P. Bernhard
  • S. Caron
  • G. KesidisEmail author
  • J. Rojas-Mora
  • S. Wong
Article
  • 311 Downloads

Abstract

Hahn and Wallsten (Econ. Voice 3(6):1–7, 2006) wrote that network neutrality “usually means that broadband service providers charge consumers only once for Internet access, do not favor one content provider over another, and do not charge content providers for sending information over broadband lines to end users.” In this paper we study the implications of non-neutral behaviors under a simple model of linear demand-response to usage-based prices. We take into account advertising revenues for the content provider and consider both cooperative and non-cooperative scenarios. In particular, we model the: impact of side-payments between service and content providers, consider an access provider that offers multiple service classes, and model leader-follower (Stackelberg game) dynamics. We finally study the additional option for one provider to determine the amount of side payment from the other provider. We show that not only do the content provider and the internaut suffer, but also the Access Provider’s performance degrades.

Keywords

Network neutrality Pricing 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. 1.
    Altman, E., Bernhard, P., Kesidis, G., Rojas-Mora, J., & Wong, S. (2010). A study of non-neutral networks. INRIA Research report Number 00481702, May 2010. Google Scholar
  2. 2.
    Caron, S., Kesidis, G., & Altman, E. (2010). Application neutrality and a paradox of side payments. In Proc. ACM ReArch, Philadelphia, Nov. 30, 2010. Google Scholar
  3. 3.
    Cheng, K., Bandyopadhyay, S., & Gon, H. (2008). The debate on net neutrality: A policy perspective. In Information systems research, June 2008. Available at SSRN: http://ssrn.com/abstract=959944. Google Scholar
  4. 4.
    Consultation publique sur la neutralité du net. du 9 avril au 17 mai 2010. http://www.telecom.gouv.fr/fonds_documentaire/consultations/10/consneutralitenet.pdf.
  5. 5.
    Economides, N. (2008). Net neutrality: non-discrimination and digital distribution of content through the Internet. I/S: A Journal of Law and Policy, 4(2), 209–233. Google Scholar
  6. 6.
    Hande, P., Chiang, M., Calderbank, R., & Rangan, S. (2009). Network pricing and rate allocation with content provider participation. In Proc. IEEE INFOCOM. Google Scholar
  7. 7.
    Hahn, R., & Wallsten, S. (2006). The economics of net neutrality. Economists’ Voice, 3(6), 1–7. Google Scholar
  8. 8.
    Kesidis, G., Das, A., & de Veciana, G. (2008). On flat-rate and usage-based pricing for tiered commodity Internet services. In Proc. CISS, Princeton, March 2008. Google Scholar
  9. 9.
    Kesidis, G. (2010). Congestion control alternatives for residential broadband access by CMTS. In Proc. IEEE/IFIP NOMS, Ōsaka, Japan, Apr. 2010. Google Scholar
  10. 10.
    Ma, R. T. B., Chiu, D.-M., Lui, J. C. S., Misra, V., & Rubenstein, D. (2008). Interconnecting eyeballs to content: A Shapley value perspective on ISP peering and settlement. In Proc. int’l workshop on economics of networked systems (NetEcon) (pp. 61–66). CrossRefGoogle Scholar
  11. 11.
    Ma, R. T. B., Chiu, D.-M., Lui, J. C. S., Misra, V., & Rubenstein, D. (2008). On cooperative settlement between content, transit and eyeball Internet service providers. In Proc. ACM CoNEXT. Google Scholar
  12. 12.
    Musacchio, J., Schwartz, G., & Walrand, J. (2009). A two-sided market analysis of provider investment incentives with an application to the net-neutrality issue. Review of Network Economics, 8(1). Google Scholar
  13. 13.
    Neelie Kroes, vice-president of the European Commission, Commissioner for the digital agenda, Press release RAPID, April 2010. Google Scholar
  14. 14.
    Network neutrality. Wikipedia. Available at http://en.wikipedia.org/wiki/Network_neutrality.
  15. 15.
    Notice of proposed rulemaking (FCC 09/93). October 2009–April 2010. Google Scholar
  16. 16.
    Odlyzko, A. (2001). Internet pricing and history of communications. Computer Networks, 36(5–6), 493–518. CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media, LLC 2011

Authors and Affiliations

  • E. Altman
    • 1
  • P. Bernhard
    • 1
  • S. Caron
    • 2
  • G. Kesidis
    • 2
    Email author
  • J. Rojas-Mora
    • 3
  • S. Wong
    • 4
  1. 1.INRIASophia-AntipolisFrance
  2. 2.CS&E and EE DeptsPennsylvania State Univ.University ParkUSA
  3. 3.Fac. of Econ. and Bus. Sci.Univ. of BarcelonaBarcelonaSpain
  4. 4.Fac. of LawUniv. of CoruñaA CoruñaSpain

Personalised recommendations