Service Adoption and Pricing of Content Delivery Network (CDN) Services
Management Science
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This paper provides an economic analysis of the ISP-operated CDN under a duopolistic competition. The two ISPs are modeled as a platform in a two-sided market providing Internet access to both content providers and consumers. By formulating a 4-level Stackelberg game, we have found that the equilibrium strategy of an ISP in determining whether to launch CDN service depends on the marginal cost of cache server deployment and the two contrary effects: "Competition Effect" and "Delay Reduction Effect."