With the development of the Internet from a research network to a commercial and integrated network which must satisfy heterogeneous user demand, prices for Internet usage play an important role. This study analyzes the pricing of Internet transport services and interconnection. It explains why appropriate pricing requires popular flat rates to be abandoned. They should be replaced by usage-based prices which are load-sensitive and take different service qualities into consideration. The aim of this work is to give an overview of Internet pricing proposals, to classify, investigate, and evaluate these pricing schemes as well as to elaborate on relations between them. Evaluations are based on normative criteria for Internet pricing from the point of view of social welfare and the perspectives of both Internet service providers and users. Moreover, this book shows what efficient settlement rules look like at the interconnection level. Since these interconnection pricing agreements are closely related to retail pricing models the compatibility between them is also analyzed.

The Author: Andrea Graber was born in 1976. Between 1995 and 2000, she studied economics in Freiburg (Switzerland). From 2000 to 2004, she worked as a research and teaching assistant at the Chair of Microeconomics and Empirical Economic Research (University of Freiburg) with Prof. Dr. Reiner Wolff. Andrea Graber obtained her Ph.D. in 2005. She is currently working for the Swiss Competition Commission in Bern.