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Journal of Information Science and Engineering, Vol.19 No.5, pp.765-786 (September 2003)

Charging the Internet Without Bandwidth Reservation: An Overview and Bibliography of Mathematical Approaches

Bruno Tuffin
Campus Universitaire de Beaulieu
35042 Rennes Cedex, France

Pricing is one of the biggest challenges facing the next generation of the Internet. Even if flat rate pricing is one of the main reasons for the success of the Internet, the only way to prevent network congestion and to differentiate services is to adopt usage-based pricing schemes. We review in this paper, from a mathematical modeling point of view, the pricing schemes without resource reservation that have been developed in the literature. Indeed, an advantage of the absence of reservation in the Internet is that network management is cheap. Even if accounting and billing will increase this cost, we believe that pricing without resource reservation is the lesser of two evils when costly bandwidth reservation procedures are applied.

Keywords: fairness, internet economics, optimization, pricing, service differentiation

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Received February 5, 2002; accepted March 6, 2003.
Communicated by Chu-Sing Yang.