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Intercarrier Compensation in Unilateral and Bilateral Arrangements

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  • Ruzana Davoyan

    ()

  • Jorn Altmann

    ()

  • Wolfgang Effelsberg

    (Technology Management, Economics, and Policy Program (TEMEP), Seoul National University)

Abstract

In terms of intercarrier compensation traffic flows are measured to allocate the costs between networks. This method provides a poor basis for sharing any costs. In this work we analyze the benefits of the traffic differentiation on the interconnection charges in unilateral and bilateral arrangements. We determine an original initiator of a transmission and compensate differently for the distinguished traffic flows. The presented approach was compared with the existing solutions, which perform cost compensation based on the traffic flows.

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File URL: ftp://147.46.237.98/DP-41.pdf
File Function: First version, 2010
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Bibliographic Info

Paper provided by Seoul National University; Technology Management, Economics, and Policy Program (TEMEP) in its series TEMEP Discussion Papers with number 201041.

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Length: 16 pages
Date of creation: Jan 2010
Date of revision: Jan 2010
Publication status: Published in IEEE ICCCN 2009, 18th International Conference on Computer Communications and Networks, San Francisco, USA, August 2009
Handle: RePEc:snv:dp2009:201041

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Keywords: Interconnection arrangements; intercarrier compensation; Internet economics;

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References

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  1. Nicholas Economides, 1997. "The Economics of Networks," Industrial Organization, EconWPA 9701002, EconWPA.
  2. Armstrong, Mark, 2001. "The theory of access pricing and interconnection," MPRA Paper 15608, University Library of Munich, Germany.
  3. Stanley Besen, 2001. "Advances in Routing Technologies and Internet Peering Agreements," American Economic Review, American Economic Association, American Economic Association, vol. 91(2), pages 292-296, May.
  4. Ruzana Davoyan & Jorn Altmann, 2010. "Investigating the Role of a Transmission Initiator in Private Peering Arrangements," TEMEP Discussion Papers, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP) 201043, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP), revised Jan 2010.
  5. Yoon Kiho, 2006. "Interconnection Economics of All-IP Networks," Review of Network Economics, De Gruyter, De Gruyter, vol. 5(3), pages 1-15, September.
  6. Michael Carter & Julian Wright, 1999. "Interconnection in Network Industries," Review of Industrial Organization, Springer, Springer, vol. 14(1), pages 1-25, February.
  7. Ruzana Davoyan & Jorn Altmann & Wolfgang Effelsberg, 2010. "A New Bilateral Arrangement between Interconnected Providers," TEMEP Discussion Papers, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP) 201044, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP), revised Jan 2010.
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