Danny Stroud <dannystroud@msn.com> wrote:

I suspect that the ease of anointing bandwidth as a surrogate for value will make it so until someone is able to measure the economic value of an individual packet or web page hit. Until then I predict that the networks with the biggest infrastructure will be in the best position to extract peering charges.

The computational cost of any microeconomical tweaking (such as resource reservation) by far exceeds the cost of delivering the service. Ergo: those who don't do that will be able to offer comparable quality of service at lower prices. The exception is static priorities. I think what will happen is that providers will be offering different "mixes" of priorities, or charge separately for priority traffic. Reservation is a non-issue. It is a bunch of B.S. I won't go into detalied explanation why, i did that many times already (i can point to a relevant paper).

Batten the hatches, the onslaught of change is upon us. I suspect that this is the first of many economic model changes in the Internet. des

I do not think there's going to be any large change. After all, the present economical model is as old as the modern civilization. In fact, the only significant change in 90s was demise of "reseller" surcharges -- which was something i was instrumental in transplanting from Russia to US (an ISP in Russia i founded with friends in 1990 created an enormous infrastructure by _subsidizing_ local ISPs by means of "wholesale" pricing and technology transfer; in effect we reinvented franchise business). The lack of the high entry barrier for small ISPs was what got Sprint into big league, and made it possible and practical for mom-and-pop ISPs to bloom (which they did immediately). Technology was available for years before the ISP boom. Ultimately, Sprint's tactics forced incumbent backbone ISPs to reevaluate the reseller surcharges (or lose the small ISP market completely). --vadim