An economic model for a new broadband ecosystem based on fast and slow lanes

Abstract

Today's residential broadband ecosystem is in stasis: ISPs suffer from low margins and flat revenues, content service providers (CSPs) have unclear incentives to invest in broadband infrastructure, and users have limited dimensions (speed/quota) in which to compare broadband pricing. This article explores the use of service quality capabilities, in the form of fast and slow lanes, for overcoming this stasis. We propose an architecture in which all entities have a say: CSPs request dynamic fast and slow lane creation for specific sessions, ISPs operate and charge for these lanes, and users control their broadband bandwidth available to such lanes. We develop an economic model that balances fast and slow lane pricing by the ISP with the returns for CSPs and service quality improvement for end users, and evaluate the parameters of our model with real traffic traces. We believe our proposal based on dynamic fast and slow lanes can represent a win-win-win situation for ISPs, CSPs, and end users alike, and has the potential to overcome the current stagnation in broadband infrastructure investment.