MIT Workshop on IE -- bottleneck facilities

An Assessment of Pricing Mechanisms for the Internet--A Regulatory Imperative

Mitrabarun Sarkar

Presented at MIT Workshop on Internet Economics March 1995

<http://www.press.umich.edu/jep/works/SarkAssess.html> says, in part:

"We note that (a) the perceived homogeneity of the Internet's load, and (b)
the threat of market-power abuse through artificial creation of a high
network load by those who control the bottleneck facilities, remain the
fundamental weaknesses of usage-based pricing. However, given that usage-
based pricing is inevitable, and that the Smart Market mechanism does
present an innovative and a potential solution, it is important to consider
the appropriate safeguards that need to be put in place. In this context,
the paper argues that a usage based, free market pricing system needs to be
combined with some form of regulatory oversight to protect against
anti-competitive actions by the firms controlling 
the bottleneck facilities and to ensure non- discriminatory access to
emerging networks."