Pushpendra Mohta wrote a good essay on economics of content
distribution.
Now, i have a silly question -- should we bother with any elaborate
pricing? I don't think the current Internet economy is broken.
--vadim
The big problem is the current incentive to cripple network connections.
Why should it cost more to connect at 100MB/sec vs. 56KB/sec? If the same
amount of packets are transfered? Why should I pay more beyond the
one-time cost of buying interface electronics?
Many real-time problems with packet switching (out of order arrival of
packets, need to re-order packets) essentially go away when speed
increases, i.e. things move out of perceptible ranges into in-perceptible
time variations.
Settlement based on whoever takes more traffic would be nice.
It gives a very direct incentive to build better networks. Lets say MAE's
and NAP's are run in a cost-recovery mode and my only monthly cost as a
network is the cost of my circuits, i.e. having a connection to the
MAE/NAP. As soon as my network takes more traffic than my circuit costs
I'm making money. Money that can be used directly to build a better
network which will take even more traffic, i.e. generate more money. In a
sense, this would provide best case capitalism with routers deciding from
whom to buy. All energy would go into building better networks... neither
advertising, nor salespeople are necessary in this scenario!
Dirk
Dirk Harms-Merbitz writes:
Why should it cost more to connect at 100MB/sec vs. 56KB/sec? If the same
amount of packets are transfered? Why should I pay more beyond the
one-time cost of buying interface electronics?
Because what costs money is engineering for peak usage. If you can
send traffic at 100MB/sec instead of 56KB/sec your peak usage can (and
likely will) be much higher.