 Internet pricing: a two sided market perspectiveSwadesh Kumar Samanta, Hui Pan, John Woods and Mohammed Ghanbari International Journal of Economics and Business Research, 2011, vol. 3, issue 2, 225-240 Abstract: We adopt a two-sided market model to represent the interaction of internet service providers (ISP), internet users and content providers to study the optimal pricing strategy for the ISP. We allow the ISP to vary all four components of the price, that is, subscription and usage price to the internet user, and subscription and usage price to the content provider. We offer a potential business advantage to the ISP describing how the total charges can be allocated between the internet user and the content provider and how the price charged to one side can be allocated between the subscription and usage parts. Under a realistic assumption, we show that a profit maximising ISP would prefer to provide access subsidy to both the internet user and the content provider and derive profit from the usage volume. Keywords: two-sided markets; ISPs; optimal pricing; world wide web; market perspectives; internet service providers; internet users; content providers; pricing strategies; price components; subscription rates; usage prices; business advantages; total charges; charge allocation; profit maximisation; access subsidies; usage volumes; economics; business research. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ids:ijecbr:v:3:y:2011:i:2:p:225-240 Access Statistics for this article More articles in International Journal of Economics and Business Research from Inderscience Enterprises Ltd |
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