Pricing Internet services: After flat rate

Because of the Internet's benefits of interoperability, statistical sharing, and (usually) positive network externalities, providers of new applications and services will attempt to create new markets for their services through the Internet, even if the underlying technical architecture of the Internet is not intrinsically designed to support such services. This article unravels the strands of economic and network theory and business practice to place new Internet standards such as Diffserv, Intserv, and RSVP, and associated new service pricing models in perspective. This article explains how the next generation Internet may work economically, and what the business strategy and policy implications may be of these changes in the Internet's architecture and infrastructure.