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Can ISPs be Profitable Without Violating Network Neutrality?. Amogh Dhamdhere Constantine Dovrolis Georgia Tech. Disclaimer. This is not a game theory talk. The Network Neutrality Debate. Recent Trend: Large amounts of video and peer-to-peer traffic on the Internet

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can isps be profitable without violating network neutrality

Can ISPs be Profitable Without Violating Network Neutrality?

Amogh Dhamdhere

Constantine Dovrolis

Georgia Tech

disclaimer
Disclaimer

This is not a game theory talk

Amogh Dhamdhere

NetEcon 2008

the network neutrality debate
The Network Neutrality Debate
  • Recent Trend: Large amounts of video and peer-to-peer traffic on the Internet
  • Access Providers (AP) deliver content to users
    • Recent trend: Not profitable
    • Flat rates, commoditization of Internet access
  • Content providers (CP) generate the content
    • Profitable (think Google)
  • Tension between AP and CPs: “Network neutrality” debate
    • Traffic shaping/prioritization by ISPs

Amogh Dhamdhere

NetEcon 2008

a technical view
A Technical View
  • Previous work
    • Mostly non-technical
    • Emotional debates in the press, painting APs as villians
  • But what about the underlying problem: Non-profitability of Access Providers?
  • Our approach: A quantitative look at AP profitability
    • Investigate reasons for non-profitability
    • Evaluate strategies for the AP to increase profit

Amogh Dhamdhere

NetEcon 2008

modeling ap profitability
Modeling AP Profitability
  • Three AS types: AP, CP and transit provider (TP)
    • Focus on the AP
  • AS links
    • customer-provider (customer pays provider)
    • peering (no payments)
  • AP and CPs can transfer traffic either through customer-provider or peering links

CP

CP

CP

CP

CP

CP

TP

CP

CP

AP

Amogh Dhamdhere

NetEcon 2008

baseline model
Baseline model
  • AP and CP connect to the TP as customers
  • N users of AP, charged a flat rate R ($/month)
    • Flat rate prices decrease due to competition
  • Transit pricing: 95th percentile of traffic volume
    • 95th / mean = 2:1 for normal traffic, 4:1 for video1
    • More video means higher transit payment by AP
  • AP users: Heavy tailed distribution of content downloaded per month
    • High variability in AP costs

1Norton’06: Internet Video: The Next Wave of Massive Disruption to the U.S. Peering Ecosystem

Amogh Dhamdhere

NetEcon 2008

ap strategies charging
AP Strategies – Charging
  • Charging strategies
    • AP charges “heavy hitters” according to volume downloaded
    • AP caps heavy hitters
    • AP charges CP (non-network neutral)
  • Charging strategies are disruptive
    • AP users may depart, depending on existing competition
    • Parameter d determines shape of departure probability curve
    • AP cannot control customer departure probability

Amogh Dhamdhere

NetEcon 2008

ap strategy charging heavy hitters
AP Strategy – Charging Heavy Hitters
  • Threshold T to identify heavy downloaders
  • Charge “by volume” for heavy hitters
  • c(D) = D*R/T, where download amount D, threshold T, flat rate R
  • Customer departure probability depends on T and d
  • AP’s profit is sensitive to customer departure probability
  • For some values of d, no threshold gives larger profit than baseline !!

Amogh Dhamdhere

NetEcon 2008

ap strategies connection
AP Strategies - Connection
  • Connection Strategies
    • AP caches content from CPs
    • AP peers selectively with CPs
  • Goal: Save transit costs paid to the transit provider
    • Does not increase the AP’s revenue
  • Non-disruptive
    • AP does not risk losing customers

Amogh Dhamdhere

NetEcon 2008

ap strategy cache cp content
AP Strategy – Cache CP Content
  • AP caches content from some CPs locally
    • Saves transit costs, as content is served locally
    • Increases local costs incurred by the AP
  • Critical parameters: Fraction of content that can be cached (h) and cost incurred for caching (s)
    • Live content cannot be cached!
  • Profit is sensitive to h, s

Amogh Dhamdhere

NetEcon 2008

ap strategies peering with cps
AP Strategies – Peering with CPs
  • Peering selectively with Content Providers can save transit costs, without risk of losing its users
  • But, peering is not free
    • Fixed, traffic dependent costs
  • Peering cost classes for CPs
    • “Low”: CPs at the same geographical location/IXP
    • “Medium”: CPs at nearby location/IXP
    • “Hard”: CPs in different continents
  • Cost benefit analysis: r = Estimated benefit/Estimated Cost
    • Peer if r > R

Amogh Dhamdhere

NetEcon 2008

ap strategies peering with cps1
AP Strategies – Peering with CPs
  • Optimal point exists for the cost-benefit threshold R
    • AP controls the factor R
  • Significant reduction in AP costs with selective peering
  • Greater benefit with fewer CPs (more traffic from the largest CPs)
  • AP can leverage expansion by large CPs

Amogh Dhamdhere

NetEcon 2008

conclusions
Conclusions
  • Network Neutrality research should also focus on the underlying problem: Non-profitability of ISPs
  • How can ISPs be profitable in spite of increasing traffic, heavy-hitter users and video traffic ?
  • Charging schemes that target heavy hitters may not work in the presence of competition in the AP market
    • Profit highly sensitive to customer departure probability
    • Out of the AP’s control
  • Connection strategies such as peering selectively with Content Providers seem promising
    • Completely under the AP’s control

Amogh Dhamdhere

NetEcon 2008

thank you
Thank You !

Amogh Dhamdhere

NetEcon 2008

ap strategy capping heavy hitters
AP Strategy – Capping Heavy Hitters
  • AP caps download rate for users
  • Limits the total amount of traffic handled
  • Saves transit costs and local costs, but does not increase revenue
  • AP profit depends on customer departure probability
  • For some values of d, no threshold gives larger profit than baseline !!
  • No significant improvement over baseline

Amogh Dhamdhere

NetEcon 2008

ap strategy charging cps
AP Strategy – Charging CPs
  • AP directly charges the top sources of content (CPs)
  • Increases revenue, but violates “network neutrality”
  • Subject to customer departure due to discriminatory practices
  • AP profit depends on customer departure probability

Amogh Dhamdhere

NetEcon 2008