Side-payment profitability and interacting eyeball ISPs under convex demand-response modeling congestion-sensitive applications

Abstract: This paper is concerned with the issue of side payments between content providers (CPs) and Internet service (access bandwidth) providers (ISPs) in an Internet that is potentially not neutral. We herein generalize past results modeling the ISP and CP interaction as a noncooperative game in two directions. We consider different demand response models (price sensitivities) for different provider types in order to explore when side payments are profitable to the ISP. Also, we consider convex (non-linear) demand response to model demand triggered by traffic which is sensitive to access bandwidth congestion, particularly delay-sensitive interactive real-time applications. Finally, we consider a model with two competing "eyeball" ISPs with transit pricing of net traffic at their peering point to study the effects of caching remote content.