A month ago, I gave a talk in the EC concertation meeting in Brussels about the price of quality in the Internet. During the talk I focused on two things: 1) defining the term quality in different domains, and 2) explaining which stakeholders in the Internet content delivery are willing to pay for quality. Because the topic may be of wider interest, I give an overview to my presentation slides in the following screencast.
The presentation itself does not contain any results from the SAIL project, because the project itself is only a couple of months old. Thus the material comes from the earlier work done mostly in the Prof. Heikki Hämmäinen’s Network Economics research group in the Aalto University. The quality in communications ecosystems analysis is based on Kalevi Kilkki’s paper Quality of Experience in Communications Ecosystem. The two-sided market and value network analysis of Internet content delivery, for one, relies heavily on Nan Zhang’s recently published Master’s Thesis Internet content delivery as a two-sided market, which was done in the frame of Finnish national Future Internet programme.
One of the most interesting topics in the presentation is the two-sided markets theory. Two-sided markets are economic platforms having two distinct user groups that provide each other with network benefits. Example markets include credit cards, composed of cardholders and merchants; operating systems (end-users and developers), yellow pages (advertisers and consumers); video games (gamers and game developers); and communication networks, such as the Internet. Good introduction to the theory can be found from Wikipedia, and Zhang’s thesis presents the application of the theory in Internet content delivery.
Screencast recorded after the presentation
The slides used in the presentation are found here (link).
Links to references used in the presentation
- Faratin P. (2007), Economics of Overlay Networks: An Industrial Organization Perspective on Network Economics, Proceedings of NetEcon+IBC, San Diego, California, June 11.
- Kilkki K. (2008), Quality of Experience in Communication Ecosystems, Journal of Universal Computer Science, vol. 14, no. 5, pp. 615-624.
- Labowitz C., Iekel-Johnson S., McPherson D., Oberheide J., Jahanian, F. (2010), Internet Inter-Domain Traffic, Sigcomm’10, pp. 75-86, New Delhi, India.
- Rochet J., Tirole J. (2006),Two-Sided Markets: A Progress Report, The RAND Journal of Economics, Vol. 37, No. 3, Autumn, 2006, pp. 645-667.
- Zhang N. (2010), Internet content delivery as a two-sided market. Master’s Thesis, Department of Communications and Networking, Aalto University School of Science and Technology, 2010.
Disclosure and disclaimer: I am engaged in the SAIL project, on behalf of Aalto University. However the opinions expressed in this post are my personal, and not those of the SAIL project or my employer.
M.Sc. (Tech) Tapio Levä is a Research Scientist and PhD student in the Department of Communications and Networking of Aalto University. His research interests cover techno-economics of Internet standards adoption, Internet architecture evolution, Internet interconnectivity agreements and Future Internet scenarios. In the SAIL project Levä focuses on the business aspects in the socio-economic task of WP-A. Contact information and publication list can be found from his academic web page.