Quality-Contingent Differentiated Pricing for Broadband Services

Even though broadband high speed Internet service has been always attractive choice to Internet users, its deployment has not been very successful. Until very recently most broadband access providers offer a single quality level and price. We propose a definition of Quality of Service (QoS) in a broadband network, present a measurement of the proposed QoS, and discuss its implementability. Further, we show that the idea of contingency pricing can in fact be applied meaningfully to broadband services to assure customers for high quality service. This paper presents our initial work towards a proposal for broadband pricing that addresses the dimension of QoS uncertainty in the context of QoS based pricing, and is designed to be consistent with the technical aspects of data flow and communications infrastructure for broadband service. Our future plans include further development of technical aspects and economic analysis of the proposed QoS and contingent pricing scheme in broadband high speed Internet services.