On Thu, Dec 2, 2010 at 7:25 PM, William Herrin <bill@herrin.us> wrote:
On Thu, Dec 2, 2010 at 4:28 PM, Steve Gibbard <scg@gibbard.org> wrote:
http://en.wikipedia.org/wiki/Two-sided_market
They don't all have the same fee-splitting systems, and you can find an example to site as precedent for just about any system you could reasonably advocate. An example raised in a talk I heard a few years ago was of scholarly journals that collect money from both their subscribers and their authors. The authors need to be published in order to get tenure, and the readers pay because they want to know what the authors are saying.
I received an interesting comment off list to the effect that there's been a rise in journals in which the authors pays while the reader has open (free) access via the web citing this example: http://openwetware.org/wiki/Publication_fees Modern newspapers have gravitated towards a comparable model in which the advertisers bear the cost of the content and the readers have free access via the web. I, for example, read washingtonpost.com most days. In the abstract, the model looks like this: 1. Pick which side of the two sided market you expect to always pay you. For example, the advertisers in the newspapers' case. 2. Offer _fully functional_ free access to the other side of the market, where "fully functional" is largely defined by that side's nature. For example washingtonpost.com 3. Ask a convenience fee for access which does not impact functionality but is in some way more desirable to one or another segment of the otherwise unpaid side of the market. For example, paying a subscription to have the hardcopy version of the newspaper delivered. The jury is still out on whether this model is economically sustainable. Still, I think it could offer useful insight to folks like Comcast. I think it likely that the recipient side of the market is going to be the always-payer for ISP service on an eyeball network. That means giving the content side basic fully functional access for free and convenience enhancements for a fee. That's why I suggested: "Maybe you'll openly peer with all comers but only at 100 mbps in any single location. You'll open as many locations deep in the network as they want, but it's the peer's problem to connect there. Naturally you'll sell a convenience service to backhaul all those connection points to a convenient location for the peers... or they can make their own arrangements but either way they don't get to massively consume your backbone for free. There's probably enough separation there between what you sell customer B and what you sell customer C to eke over to the "good" side of the ethics line. And by the way an open peering policy with those parameters would make you the Chamber of Commerce's new best friend, enabling small business to vend innovative products directly to your customers (and then pay you for the convenience of aggregation once they build up a customer base)." The key pitfall with this model is function versus convenience. Your paid enhancements to the second side of the market can offer greater convenience but you cross the line if they offer greater functionality. Connecting where I want (instead of where you offer) is convenient. Connecting with enough bandwidth for my service to be usable is functional. Regards, Bill Herrin -- William D. Herrin ................ herrin@dirtside.com bill@herrin.us 3005 Crane Dr. ...................... Web: <http://bill.herrin.us/> Falls Church, VA 22042-3004