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Pricing Communication Networks: Economics, Technology and Modelling (Wiley Interscience Series in Systems and Optimization)
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Network Quality of Service (QoS) concerns the transformation of current internets into systems that can offer one or more levels of QoS. Choosing the "best" QoS will require making decisions about the relative costs of network capacity and the machinery to manage it. Pricing is not only needed for recovering costs, but is also needed as a method of control. The congestion that has plagued the Internet, where pricing is based largely on a flat rate pricing, highlights the fact that without a more efficient pricing method it is difficult to control congestion and share network resources. This research uses the time-volume charging scheme, which determines that both the service time and transmitted volume are able to reflect the usage of a network. Service contracts for communications services do not specify fully the resources that are required to produce a unit of output, and therefore prices can be used both to regulate resource sharing and to maximize social efficiency.