QUALITY OF SERVICE DELIVERY: ECONOMIC EFFECTS OF MULTI-HOMING AND CONTENT DELIVERY NETWORKS

The structure of the Internet serves as a big commoditizer of all traffic. Therefore all data, be it time critical or not is transported at the same speed. However, recent trends in the internet are changing this structure. The practices of multi-homing and using content delivery networks reduce the commodity nature of data being transported and put terminating Internet service providers in a position to price discriminate against specific providers or types of traffic. We firstly formalize multi-homing and content delivery networks, we then derive end user prices for paid content and lastly show consequences of the modeled situation. We thus show how the two technologies to bypass crowded peerings change the Internet business model. Traffic which is sensitive to transport quality, such as business critical or delay sensitive traffic, will be paying higher fees to terminating ISPs

Interconnection and Competition Among Asymmetric Networks in the Internet Backbone Market

We examine the interrelation between interconnection and competition in the internet backbone market.Networks asymmetric in size choose among different interconnection regimes and compete for end-users.We show that a direct interconnection regime, Peering, softens competition compared to indirect interconnection since asymmetries become less influential when networks peer.If interconnection fees are paid, the smaller network pays the larger one. Sufficiently symmetric networks enter a Peering agreement while others use an intermediary network for exchanging traffic.This is in line with considerations of a non-US policy maker.In contrast, US policy makers prefer Peerings among relatively asymmetric networks.Internet Backbone;Endogenous Network Interconnection;Asymmetric Networks;Two-Way Access Pricing

Paid Peering and Content Delivery

Recent conflicts between big content and service providers (CSPs) like Netflix, transit providers (TPs), and Internet service providers (ISPs) have generated considerate media attention and ignited a debate on interconnection agreements, market power of last-mile ISPs and net neutrality. We propose an experimental design to analyze a stylized interconnection market that captures key aspects of actual interconnection markets with a focus on the entry of big CSPs. Participants are invited to assume the roles of ISPs, TPs and CSPs in a computer-aided laboratory experiment. The experiment serves to evaluate potential regulatory tools like transparency and interconnection obligation with respect to the efficiency of the overall interconnection market. Furthermore, we present results of a pre-test of the experimental design and the software implementation. Our preliminary results indicate that operators underinvest into network infrastructure and do not realize the full potential of mutual peering agreements when a CSP participates in the market

Do internet incumbents choose low interconnection quality?

In this paper we analyze the interconnection incentives for two networks that differ with respect to size of their installed based. In the first part we prove that the smaller firm may be harmed in competition for new customers if the installed base customers pay a high price. In the second part we assume that the interconnection quality to customers in the installed bases is set before the interconnection quality to new customers. We show that both firms prefer perfect interconnection quality to new customers if the installed base interconnection quality is sufficiently high, and we discuss what policy implications this may have

Competition and regulations in telecommunications with asymmetric firms

This thesis examines competition among asymmetric firms in three different theoretical frameworks. The first study investigates mobile telecommunications, with a strong focus on access charge on off-net calls. Compared to the symmetric cost-based access charge regulation, whilst the asymmetric cost-based access charge regulation facilitates entry, it dampens social welfare if, relative to the incumbent, the new firm is significantly inefficient in cost, distinctly inferior in reputation, and incapable of clearly differentiating its service from the one provided by the established firm. The second study sheds light on a broader framework of infrastructure sharing among telecommunications firms with asymmetric cost structures. Compared to stand-alone investment, co-investment is deemed to be collusive in quality upgrade, and consequently decreases industry output and consumer surplus when infrastructure sharing does not yield a sufficient amount of cost saving. Even though the fully-distributed-cost regulation can stimulate investment in quality upgrade, it undermines incentives to expand consumer bases, leads to price increases, and eventually dampens consumer welfare. The last study captures the competition beyond only one product market where a multi-product firm competes with its single-product rivals by using a variety of bundling strategies that impact on firms’ incentives for quality enhancement in different ways. The pure-bundling strategy can encourage the multi-product firm to invest in quality enhancement when the associated costs are comparatively low and the additional utility from quality enhancement is relatively high, but it certainly discourages the single-product firms from improving quality. In the mixed-bundling case, this outcome inevitably occurs in the more competitive market, and it is likely to be found in the less competitive market when the markets are not too different in competition intensity. Therefore, both bundling strategies threaten consumer welfare when the two markets are significantly different in competition intensity due to the negative influence of the market distortions after tying the two markets

Information and communication technology as a tool for craft market traders in promoting community tourism.

Doctoral Degree. University of KwaZulu-Natal, Durban.This is an interdisciplinary study, taking information and communication technology (ICT) as a point of departure, incorporating tourism, art and craft, e-business and community development as the field of knowledge. The craft market traders around Hluhluwe-Imfolozi Park (HIP) lack essential business tools, such as ICT devices, to improve craft market trading with tourists, nationally and internationally, without the intervention of the middleman, who could help to enable sustainable community development. Craft market traders manufacture or produce their crafts using natural resources such as Juncus maritimus and thatch grass for mats, bowls and hats. They use tree trunks and natural wood for sculptures and meat platters. Most of these natural resources are already depleted outside the protected areas and local communities have to rely on natural resources inside the park. Harvesting without permission in the park is illegal. The researcher has provided a step-by-step outline on how she intends to execute the logical chain of events that would produce solutions to the problems identified and answers to critical questions. The researcher examined the historical background of craft, the cultural background of the craft market traders and ICT devices that can improve their business performance. The business sector, as well as government, played a role in the success of this research. ABSA Bank and the Department of Economic Development were engaged. There are possible positive outcomes, such as the installation of an ABSA automatic teller machine in HIP. The overall objective of the research was to find solutions that can enhance the standard of living of the local communities, by increasing the employment rate in terms of craft market traders selling their craft, nationally and internationally