The 15 commandments of market entrance pricing for differentiated network services: An antagonistic analysis of human vs. market

Abstract

Confronted with soaring IP traffic demands and unsatisfying revenue prospects, charging and tariffing alternatives are about to regain significant attention in the telecommunications industry. While classical revenue optimization and customer perceptions, i.e., Quality of Experience (QoE), has been largely investigated by now, the understanding of customer valuations, i.e., willingness-to-pay, is still far from being sufficient. Hence, this paper revisits and extends the charging ecosystem by unifying empirically-backed demand and expenditure considerations with supply-side revenue optimization, and pays specific attention to the market introduction of new services, such as quality-differentiated network services. Finally, a series of (partially antagonistic) conclusions for Network Service Providers (NSPs) are derived and discussed. © 2014 Springer International Publishing.