Lee W. McKnight

Pricing Internet services: proposed improvements

Flat-rate pricing appeals to Internet users and service providers because of its simplicity and predictability. However, congestion is the inevitable consequence of flat-rate pricing because Internet users who pay a fixed access fee have no incentive to limit their network usage. Future applications that require timely delivery of data will require mechanisms for allocating network resources that give consumers choices in services and prices while allowing service providers to recover their costs. We examine the proposed improvements in Internet pricing that are designed to increase its economic efficiency and support the deployment of new applications that require a better quality of service than the Internet currently offers.

Pricing Internet services: after flat rate

Because of the Internets benefits of interoperability, statistical sharing, and (usually) positive network externalities, providers of new applications and services will attempt to create new markets for their services through the Internet, even if the underlying technical architecture of the Internet is not intrinsically designed to support such services. This article unravels the strands of economic and network theory and business practice to place new Internet standards such as Diffserv, Intserv, and RSVP, and associated new service pricing models in perspective. This article explains how the next generation Internet may work economically, and what the business strategy and policy implications may be of these changes in the Internets architecture and infrastructure.

Show me the money: contracts and agents in service level agreement markets

Delivering real‐time services (Internet telephony, video conferencing, and streaming media as well as business‐critical data applications) across the Internet requires end‐to‐end quality of service (QoS) guarantees, which requires a hierarchy of contracts. These standardized contracts may be referred to as service level agreements (SLAs). SLAs provide a mechanism for service providers and customers to flexibly specify the service to be delivered. The emergence of bandwidth and service agents, traders, brokers, exchanges and contracts can provide an institutional and business framework to support effective competition. This article identifies issues that must be addressed by SLAs for consumer applications. We introduce a simple taxonomy for classifying SLAs based on the identity of the contracting parties. We conclude by discussing implications for public policy, Internet architecture, and competition.

Drahtloser Internet-Zugang: 3G oder WiFi?

Die beiden bedeutendsten Phanomene, die im Laufe des letzten Jahrzehnts die Telekommunikation beeinflussten, waren das explosive, parallel ablaufende Wachstum sowohl des Internet als auch der Mobilfunkdienstleistungen. Das Internet brachte der breiten Masse die Vorteile der Datenkommunikation in Form von E-Mail, Web und E-Commerce, wahrend die Mobilfunkdienste die Moglichkeit „folge mir uberallhin/immer eingeschaltet“ im Bereich der Telekommunikation erlauben. Das Internet trug dazu bei, den Trend vom sprach- zum datenzentrierten Networking zu beschleunigen. Der Datenverkehr ubertrifft bereits den sprachbasierten Verkehr bei weiterhin steigendem Datenanteil. Derzeit konvergieren diese beiden Welten. Diese Konvergenz bietet die Vorzuge neuer interaktiver Multimedia-Dienste gekoppelt mit der Flexibilitat und Mobilitat der drahtlosen Technologie. Um das gesamte Potenzial der Konvergenz auszuschopfen, benotigen wir allerdings Breitbandzugange. Was man genau unter „Breitband“ versteht, ist naturlich eine sich wandelnde Definition, aber Breitband sollte zumindest Datenraten von Hunderten von Kilobits pro Sekunde (Kbps) verglichen mit den 50 Kbps unterstutzen, die noch von 80% der Internet-Nutzer in den Vereinigten Staaten genutzt werden, die sich nach wie vor auf Einwahlmodems uber verkabelte Verbindungen oder sogar auf noch blutleerere 10-20 Kbps verlassen, die typischerweise von der derzeitigen Generation verfugbarer Mobildatendienste unterstutzt werden. Wahrend man sich bzgl. der Notwendigkeit eines drahtlosen Breitband-Internet-Zugangs weitlaufig einig ist, bleibt grose Unsicherheit und Uneinigkeit uber die kunftige Entwicklung des drahtlosen Internet bestehen.

Survival of the fastest: the Internet and 21st century business practice

Contends the Internet is a medium for commerce, marketing, advertising and distribution, as well as invention, entertainment and discussion. Reckons that on the Internet there is only on certainty – when creative destruction reigns it is business as usual. Concludes that succeeding in the global Internet economy is very difficult, and survival is far from assured.