Market driven network neutrality and the fallacies of Internet traffic quality regulation

In the U.S. paying for priority arrangements between Internet access service providers and Internet application providers to favor some traffic over other traf-fic is considered unreasonable discrimination. In Europe the focus is on mini-mum traffic quality requirements. It can be shown that neither market power nor universal service arguments can justify traffic quality regulation. In particular, heterogeneous demand for traffic quality for delay sensitive versus delay insen-sitive applications requires traffic quality differentiation, priority pricing and evolutionary development of minimal traffic qualities. --

Network Neutrality and the Evolution of the Internet

In order to create incentives for Internet traffic providers not to discriminate with respect to certain applications on the basis of network capacity requirements, the concept of market driven network neutrality is introduced. Its basic characteristics are that all applications are bearing the opportunity costs of the required traffic capacities. An economic framework for market driven network neutrality in broadband Internet is provided, consisting of congestion pricing and quality of service differentiation. However, network neutrality regulation with its reference point of the traditional TCP would result in regulatory micromanagement of traffic network management. --Broadband Internet,network neutrality,quality of service differentiation,congestion pricing,interclass externality pricing,interconnection agreements

Network neutrality and the evolution of the internet

In order to create incentives for Internet traffic providers not to discriminate with respect to certain applications on the basis of network capacity require-ments, the concept of market driven network neutrality is introduced. Its basic characteristics are that all applications are bearing the opportunity costs of the required traffic capacities. An economic framework for market driven network neutrality in broadband Internet is provided, consisting of congestion pricing and quality of service differentiation. However, network neutrality regulation with its reference point of the traditional TCP would result in regulatory micro-management of traffic network management. --