Saturday, January 03, 2004

Internet pricing paper

This paper analyses the issues surrounding the future of Internet pricing. It is unnecessarily long, but worth a browse. The key points, imho, are:

There's some interesting history in this paper regarding railroad, highway, canal, lighthouse pricing.

Another interesting argument is in favor of open architecture on the Internet. The paper pretty much says that the telcos were dumb to spend so much money on QoS, ATM etc. since that's not going to bring them additional revenues - IP will win and the pipes will just keep growing larger.

The authors state confidently that while streaming video is the Holy Grail of telcos, what users are really looking for is ever faster file transfer. They also slam the asymmetric nature of DSL/cable-modem services.

What I did not understand was how the authors explain the cell phone companies who have continued to innovate (WAP, SMS, 3G, Blackberry) while sticking mostly to closed architecture and discriminatory pricing.

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