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Asymmetry and discrimination in Internet peering: evidence from the LINX

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Author Info

  • D'Ignazio, Alessio
  • Giovannetti, Emanuele

Abstract

Is the quality of interconnection between Internet operators affected by their asymmetry? While recent game theoretic literature provides contrasting answers to this question, there is a lack of empirical research. We introduce a novel dataset based on Internet routing policies, and study the interconnection decisions amongst the Internet Service Providers (ISPs) that are members of the London Internet Exchange Point (LINX). Our results show that interconnection quality degradation can be significantly explained by asymmetry between providers. We also show that Competition Authorities should also focus on the "centrality of an operator", and not only on its market share.

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Bibliographic Info

Article provided by Elsevier in its journal International Journal of Industrial Organization.

Volume (Year): 27 (2009)
Issue (Month): 3 (May)
Pages: 441-448

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Handle: RePEc:eee:indorg:v:27:y:2009:i:3:p:441-448

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Web page: http://www.elsevier.com/locate/inca/505551

Related research

Keywords: Internet peering Two-sided markets Network industries Antitrust Net neutrality;

References

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  1. Mason, R., 1999. "Compatibility between differentiated networks," Discussion Paper Series In Economics And Econometrics 9909, Economics Division, School of Social Sciences, University of Southampton.
  2. Thorsten Wichmann & Pio Baake, 1998. "On the Economics of Internet Peering," Berlecon Research Papers 0004, Berlecon Research.
  3. Giovannetti, Emanuele, 2002. "Interconnection, differentiation and bottlenecks in the Internet," Information Economics and Policy, Elsevier, vol. 14(3), pages 385-404, September.
  4. Giovannetti, Emanuele & Ristuccia, Cristiano Andrea, 2005. "Estimating market power in the Internet backbone. Using the IP transit Band-X database," Telecommunications Policy, Elsevier, vol. 29(4), pages 269-284, May.
  5. Venkatesh Bala & Sanjeev Goyal, 2000. "A Noncooperative Model of Network Formation," Econometrica, Econometric Society, vol. 68(5), pages 1181-1230, September.
  6. Foros, Oystein & Kind, Hans Jarle & Sørgard, Lars, 2003. "Access Pricing, Quality Degradation, and Foreclosure in the Internet," University of California at Santa Barbara, Economics Working Paper Series qt62p0k04c, Department of Economics, UC Santa Barbara.
  7. Takanori Ida, 2005. "Analysis of Internet topology with a three-level components model," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 26(8), pages 527-534.
  8. Narine Badasyan & Subhadip Chakrabarti, 2003. "Private Peering Among Internet Backbone Providers," Industrial Organization 0301002, EconWPA, revised 20 Jan 2003.
  9. Jackson, Matthew O. & Wolinsky, Asher, 1996. "A Strategic Model of Social and Economic Networks," Journal of Economic Theory, Elsevier, vol. 71(1), pages 44-74, October.
  10. Martin B. Weiss & Seung Jae Shin, 2004. "Internet Interconnection Economic Model and its Analysis: Peering and Settlement," Netnomics, Springer, vol. 6(1), pages 43-57, 04.
  11. Cremer, Jacques & Rey, Patrick & Tirole, Jean, 2000. "Connectivity in the Commercial Internet," Journal of Industrial Economics, Wiley Blackwell, vol. 48(4), pages 433-72, December.
  12. Foros, Oystein & Hansen, Bjorn, 2001. "Competition and compatibility among Internet Service Providers," Information Economics and Policy, Elsevier, vol. 13(4), pages 411-425, December.
  13. Economides, Nicholas, 1998. "The incentive for non-price discrimination by an input monopolist," International Journal of Industrial Organization, Elsevier, vol. 16(3), pages 271-284, May.
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Cited by:
  1. D’Ignazio, Alessio & Giovannetti, Emanuele, 2014. "Continental differences in the clusters of integration: Empirical evidence from the digital commodities global supply chain networks," International Journal of Production Economics, Elsevier, vol. 147(PB), pages 486-497.

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