Application-Based Quality Assessment of Internet Access Service

Daeho Lee (), Jungwoo Shin () and Junseok Hwang ()
Additional contact information
Daeho Lee: The School of Information Sciences, University of Pittshurgh
Jungwoo Shin: College of Engineering, Seoul National University
Junseok Hwang: College of Engineering, Seoul National University

No 201183, TEMEP Discussion Papers from Seoul National University; Technology Management, Economics, and Policy Program (TEMEP)

Abstract: As Internet applications become more sensitive to latency, the needs for network management increase. To maximize consumer surplus and profit of Internet service provider at the same time, it is necessary to investigate the consumer’s willingness to pay for a given quality of service (QoS) level. This study investigates consumer preferences for Internet access services that provide different levels of QoS for different applications. Conjoint method and mixed logit model are used to estimate consumer preference. As a result, consumers react most sensitively to changes in the quality of the web browsing service and have the highest marginal willingness to pay (MWTP) for improvements in the quality of this service. On the other hand, MWTPs are relatively low for voice over IP (VoIP) and IP television (IPTV), which are sensitive to latency. However, it is shown that the MWTPs of VoIP and IPTV increase when VoIP (IPTV) users are separated from VoIP (IPTV) non-users or when it is assumed that there is no substitute for VoIP (IPTV). It implies that Internet service providers can profit by providing high QoS to VoIP and IPTV as the markets for VoIP and IPTV services mature and user numbers increase.

Keywords: Quality of experience; quality of service; conjoint survey; mixed logit; Bayesian estimation; Internet. (search for similar items in EconPapers)
JEL-codes: C11 C35 D11 D12 L1 L5 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2011-11, Revised 2011-11
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:snv:dp2009:201183

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