Economics and Value of Information Systems


The economic principals of today’s internet have facilitated the rapid development of the digital economy. However, contentproviders with business models that are based on Voice over IP, internet-based TV or Software-as-a-Service have higherquality requirements than other internet companies. Thus, network operators are discussing the introduction of qualitydifferentiated transport classes (QoS). This article uses the methodology of agent-based computational economics (ACE) toassess the economics of a QoS interconnection market. Based on real-world market data we choose a representative set ofnetworks for simulating the value distribution among different network types in three market phases. Moreover, we analyzewhich network properties correlate with market success. The results suggest that content providers have strong incentives toestablish direct interconnections with access providers. Thus, transit providers will be bypassed and face falling revenues.Access network providers will be able to collect most transport revenues and refinance infrastructure investments.