Network neutrality on the Internet: A two-sided market analysis

نویسندگان

  • Nicholas Economides
  • Joacim Tåg
چکیده

We discuss network neutrality regulation of the Internet in the context of a two-sided market model. Platforms sell broadband Internet access services to residential consumers and may set fees to content and application providers on the Internet. When access is monopolized, cross-group externalities (network effects) can give a rationale for network neutrality regulation (requiring zero fees to content providers): there exist parameter ranges for which network neutrality regulation increases the total surplus compared to the fully private optimum at which the monopoly platform imposes positive fees on content providers. However, for other parameter values, network neutrality regulation can decrease total surplus. Extending the model to a duopoly of residential broadband ISPs, we again find parameter values such that network neutrality regulation increases total surplus suggesting that network neutrality regulation could be warranted even when some competition is present. 2012 Elsevier B.V. All rights reserved.

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

منابع مشابه

Welfare Implications of Deviation from Network Neutrality: A Price Discrimination Application

This paper investigates how incentives of network operators to deviate from neutrality may create social costs or benefits in different market structures. The deviation from network neutrality is a general form of discrimination based on charging different prices for non-affiliated content and application providers. In this paper, deviation from network neutrality is formulated as a form of ver...

متن کامل

Equilibria of Prices and Investments in Two-sided Internet Content Delivery Market

The Internet content delivery market has been positioned for tremendous growth. To capture the essentials of pricing structures in this market, we develop an economic model incorporating prices with provider investments in the demand function, and obtain equilibrium prices and investments under both monopoly and competitive settings for transport providers. We also investigate network neutralit...

متن کامل

Innovation through discrimination!? A Formal Analysis of the Net Neutrality Debate

We model the main arguments of the net neutrality debate in a two-sided market framework with network congestion sensitive content providers and Internet consumers on each side, respectively. The platform is controlled by a monopolistic Internet service provider, who may choose to sell content providers prioritized access to its customers. We explicitly consider the adverse effects of traffic p...

متن کامل

A Two-Sided Market Analysis of Provider Investment Incentives With an Application to the Net-Neutrality Issue.∗

We address whether providers of last-mile access (local ISPs) to end users should be allowed to charge content providers, who derive advertising revenue, for the right to access end users. This question is part of the larger debate on network neutrality. We compare two-sided pricing where these charges are allowed to one-sided pricing where such charges are prohibited by possible network neutra...

متن کامل

Network Regulations and Market Entry

This paper uses a two-sided market model to study if lastmile access providers (ISPs), should charge content providers (CPs), who derive revenue from advertisers, for the right to access ISP’s end-users. We compare two-sided pricing (ISPs could charge CPs for content delivery) with one-sided pricing (neutrality regulations prohibit such charges). Our analysis indicates that number of CPs is low...

متن کامل

ذخیره در منابع من


  با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

عنوان ژورنال:
  • Information Economics and Policy

دوره 24  شماره 

صفحات  -

تاریخ انتشار 2012