In Internet Economics
(Editors Lee W. McKnight and
Joseph P. Bailey) MIT Press,
1997. (ISBN 0 262 13336 9) Pages 253-278.
Available as postscript,
or (in an older version) html
Statistical sharing over several time-scales is a key feature of the Internet, and is likely to be an essential aspect of future ATM networks. In this chapter we describe how usage-sensitive pricing can encourage statistical sharing, and we provide a quantitative framework for the discussion of pricing issues in systems where statistical sharing is important.
In particular we describe a simple charging and accounting mechanism for real-time bursty connections, based on the concept of an effective bandwidth. The mechanism performs the dual role of conveying information to the network that allows more efficient statistical sharing, and information to the user about the resource implications of differently policed connection requests. The resulting tariff takes a strikingly simple form: a charge a(x) per unit time, a charge b(x) per unit volume of traffic carried, and a charge c(x) per connection, where the triple (a(x),b(x),c(x)) are fixed at the time of connection acceptance as a function of the connection contract x. This form of tariff is also able to reveal user preferences concerning delay tolerant traffic, and thus promises to provide a unified pricing model over a wide range of quality of service classes.See also