Net effects of Net Neutrality: The case of Amazon’s Twitch.tv

Jose Tudón Maldonado ()

No 17-14, Working Papers from NET Institute

Abstract: Net neutrality encourages content provision but also creates congestion externalities from the increase in data traffic. I study the consequences of net neutrality in Twitch.tv, a popular internet platform, by estimating a two-sided market model that considers the interactions between content provision, its consumption and congestion. The platform is non-neutral because it gives preference to the most popular content providers by compressing their data, which makes them accessible to more consumers. I use the estimated preferences and technological parameters to study the counterfactual where net neutrality is imposed in the platform. Consumer welfare would drop 3 percent. The platform would need to significantly increase its investment in its physical infrastructure to compensate consumers for the drop. The drop will be underestimated if congestion is ignored. Content provision does not increase but its quality drops.

Keywords: Net neutrality; Congestion externalities; Internet; Two-sided markets (search for similar items in EconPapers)
JEL-codes: D22 D62 L13 L14 L82 L96 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2017-01
New Economics Papers: this item is included in nep-com, nep-pay and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.netinst.org/Tudon_17-14.pdf (application/pdf)
no

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:net:wpaper:1714

Access Statistics for this paper

More papers in Working Papers from NET Institute
Bibliographic data for series maintained by Nicholas Economides ().