Price Setting in Two-sided markets for Internet Connectivity
Due to a lack of incentives, Internet peerings are a notorious bandwidth bottleneck. Through the use of direct interconnection and content delivery networks, content providers are able to provide better services to their customers. These technologies have a profound impact on the business models of internet service providers. Instead of competing for consumers and keeping uplink connection costs low, ISPs face a two-sided market in which they compete for EUs and generate revenues on the CP side of the market. This work presents a formal model for the providers' pricing decision towards content providers and discusses consequences for the Internet.
Network Economics for Next Generation Networks
6th International Workshop on Internet Charging and QoS Technologies (ICQT'09) (Collocated with IFIP Networking Conference)