Liquid Pricing for Digital Infrastructure Services

Subhajyoti Bandyopadhyay and Hsing Kenneth Cheng
International Journal of Electronic Commerce,
Volume 10, Number 4, Summer 2006, pp. 47.

Abstract: Broadband access providers, facing infrastructure overcapacity combined with low service penetration, have begun to introduce intermediate levels of service. “Liquid bandwidth” is a novel pricing scheme that lets customers pay a per-unit access charge to temporarily upgrade their service when they want to utilize broadband for newer types of on-line content. Such pricing schemes can significantly boost the profits of the service provider. Effective penetration of broadband services in a monopolist market might require regulatory intervention or some form of subsidy.

Key Words and Phrases: Broadband access pricing, digital infrastructure services, liquid pricing, market regulation, market segmentation, public policy, universal access.