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Network neutrality and difference in efficiency among Internet application service providers: A meta-frontier analysis

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  • Lee, Daeho
  • Hwang, Junseok

Abstract

As Internet applications evolve and require wider and more stable bandwidth, Internet service providers (ISPs) try to maximize their profit by controlling application service providers (ASPs); this has caused a network neutrality debate. This article categorizes ASPs into four groups by bandwidth-usage attributes and latency sensitivity. By estimating the efficiency of these groups, their efficiency differences are estimated, indicating evidence of discrimination of ISPs when network neutrality is not maintained. Meta-frontier analysis is used to compare efficiencies across companies using different production function technologies. Finally, a Tobit regression model is used to determine which variables explain the difference of efficiencies. The estimation result indicates that the discrimination of ISPs against ASPs is not significant enough to decrease the efficiency of any application group.

Suggested Citation

  • Lee, Daeho & Hwang, Junseok, 2011. "Network neutrality and difference in efficiency among Internet application service providers: A meta-frontier analysis," Telecommunications Policy, Elsevier, vol. 35(8), pages 764-772, September.
  • Handle: RePEc:eee:telpol:v:35:y:2011:i:8:p:764-772
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    Citations

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    Cited by:

    1. Lee, Daeho & Kim, Yong-Hwa, 2014. "Empirical evidence of network neutrality – The incentives for discrimination," Information Economics and Policy, Elsevier, vol. 29(C), pages 1-9.
    2. Sombat Singkharat & Aree Wiboonpongse & Yaovarate Chaovanapoonphol, 2012. "Efficiency of improved peeled longan drying technology in Thailand: A metafrontier approach," The Empirical Econometrics and Quantitative Economics Letters, Faculty of Economics, Chiang Mai University, vol. 1(3), pages 19-32, September.
    3. repec:gam:jsusta:v:8:y:2016:i:5:p:469:d:69883 is not listed on IDEAS
    4. Yang, Anhyuk & Lee, Daeho & Hwang, Junseok & Shin, Jungwoo, 2013. "The influence of regulations on the efficiency of telecommunications operators: A meta-frontier analysis," Telecommunications Policy, Elsevier, vol. 37(11), pages 1071-1082.
    5. Liao, Chun-Hsiung & Lien, Chun-Yu, 2012. "Measuring the technology gap of APEC integrated telecommunications operators," Telecommunications Policy, Elsevier, vol. 36(10), pages 989-996.
    6. Kyoungsun Lee & Yuri Park & Daeho Lee, 2016. "Effect of the ICT Ecosystem Structure on the Sustainable Growth of ICT Firms: A Metafrontier Analysis on China, South Korea, the United States, and Japan," Sustainability, MDPI, Open Access Journal, vol. 8(5), pages 1-9, May.

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