An approach to pricing of connectionless network services

In the Internet, the current flat-fee pricing scheme is not suitable to prevent congestion situations. Therefore, pricing is likely to be changed in the future, such that users are charged according to the resources they consume – a usage-based pricing scheme. Because of the heterogeneous network infrastructure, a uniform pricing mechanism must provide for localized pricing policies. It is necessary to allow a step-by-step transition from flat-fee towards usage-based pricing. In this paper, we propose a simple pricing mechanism, best-effort pricing, that accomplishes the above goals. Given the connectionless nature of the Internet, we explain why no accurate charging is possible. With best-effort pricing, charges are based on the amount of generated traffic and apply to the sender only. Implications on transport protocols and applications are identified. Finally, we sketch the transition from current flat-fee pricing to best-effort pricing.