This project will study the design and implementation of congestion-sensitive pricing schemes for the Internet. Pricing is >viewed as a tool to achieve economic objectives as well as a complementary instrument to existing traffic management techniques to achieve provisioning and congestion control objectives. The work is based upon Internet pricing concepts such as expected capacity and smart markets, and will focus on the differentiated-services framework (a new Internet standard) for its implementation.
The schemes designed will be broadly based upon the economic concept of contracting. The central hypothesis in our framework is that a network could, based upon congestion monitoring mechanisms, raise prices and vary contract terms dynamically. The project will investigate a range of mechanisms including soft (short-term) contracts, bidding models for receiver-initiated services, usage-based or flat prices for excess traffic, and congestion-sensitive update of prices. An important objective of the project is to develop schemes that can be readily implemented in the differentiated services architecture, without need for additional standardization.
The PIs will collaborate to investigate specific issues arising in their areas of expertise: a) traffic management mechanisms in the Internet, and b) information systems (IS) and economic underpinnings of pricing mechanisms. The pricing schemes and demand models derived in this framework will be integrated into detailed packet-level network simulations to study the combined impact of these technical and economic control techniques.