1. Internet Economics perspective on Accounting & Billing

2. “Middleware” requirements emerge
Between network (routers) and economics
Today - statistics collection
counting bytes and packets
more detail than calls despite greater economy
more RAM for accounting than for traffic in device
data movement and management
Open questions for the future
what to measure?
how to control?
network economics research guidance

3. Outline Internet Economics Call - Integrated Service Access Rate
Differentiated service
Billing and Rationing
Congestion
Which mechanisms should we provide?

4. Internet Economics Economic efficiency v. network efficiency
Economic theories
cost when not congested is zero
price at marginal cost of expansion
axiomatic analysis of fairness
Practical reality
usage constraining more important than usage
pricing at edges

5. Smart Market User puts bid into each packet
Routers queue based on bids
Highest-bid packet dropped due to congestion sets the price for all packets
Feasibility?
bid field in packet
authority to bill
how to apply across multiple routers and domains

6. Reservations Usage billing as with telephone calls
Based on duration and capacity
QoS as reserved
Bill for reservation rather than use to discourage over-reserving
COPS provides accounting and control
Integrated Services Internet (RSVP) scaling concerns

7. Access Rate Maximum rate based on access circuit
Measured maximum with access-circuit size miss-matching need (e.g. UUNET)
automate peak measurement?
Controlled maximum rate
Committed Access Rate
Better than total volume pricing
encourages shifting to off-peak use

8. Price per bandwidth $ Kbps Data source: November 1997
how to present to SPs
present billing strategy to customer as
multi-phased,
evolutionary and revolutionary
from what Cisco offers today (better than competition)
to end-game 6-months, 12-months, 18-months
how to present internally
AMA/AMATPS, traditional telco is important but don’t undersell need to explore/innovate (see “Extensions”)
how to present to billing partners
Cisco hands off aggregated/mediated/correlated data to partner in common, easy to adopt, formats
partner generates turnkey billing solutions
Kbps
Data source: November 1997

9. Price per bandwidth commodity dial$
$20
flat-rate dial-up
how to present to SPs
present billing strategy to customer as
multi-phased,
evolutionary and revolutionary
from what Cisco offers today (better than competition)
to end-game 6-months, 12-months, 18-months
how to present internally
AMA/AMATPS, traditional telco is important but don’t undersell need to explore/innovate (see “Extensions”)
how to present to billing partners
Cisco hands off aggregated/mediated/correlated data to partner in common, easy to adopt, formats
partner generates turnkey billing solutions
Kbps

10. Differentiated Service
Assured Service
Premium Service
Settlement
Smart Market approximation
Integrated and Differentiated Services

11. Differentiated Services
Clark’s Assured Service
mark in-profile traffic for better-than-best-effort
RED with In-Out (RIO)
Cisco CAR and WRED can do this
Jacobson’s Premium Service
priority queue for premium low-latency
strict policing to provisioned rate
Diff-serv WG for DS-byte per-hop behavior

12. Two Service Levels are Shown; Up to Six
WRED
Probability
of Packet Discard
Adjustable
Slope
Assured
Service
Profile
Cisco has extended the excellent capabilities of RED to apply to multiple traffic classes via a new feature called Weighted RED (WRED). WRED allows the service provider to establish a RED profile per traffic class. This profile includes minimum threshold, maximum threshold and discard probability parameters. Thus, during periods of congestion, premium packets can be given better treatment by establishing a lower minimum threshold for standard packets (and possibly a lower discard probability). In adition, we have developed a high-performance distributed implementation of this (and the other features) that scales to DS3 per VIP on the VIP2-40 and OC3 per VIP on the VIP2-50.
Two Service Levels are Shown; Up to Six
Can Be Defined
Average
Queue
Depth
Interface
Maximum
Threshold
Low Priority
High Priority

13. Approximate Smart Market
Per-domain bidding server
Compress bids to DS field in the IP header
Policy controls authorize payment
Still needs an indicator of dropped traffic
How to settle between domains?

14. Billing-Rationing Service
Some subscribers need fixed bills
fixed budgets
Token bucket based service
payment fills the bucket
rationing of premiums to avoid exhaustion
Interactive billing-payment fits future vision of electronic commerce

15. Congestion Billing Marginal cost is zero unless congested
All the above methods do not address non-responsive flows
RED measures congestion
account in the core
mark for accounting at the edge
Billing for waste

16. Summary of concepts Different QoS implies different prices
Billing should fit the type of communication
duration and capacity for calls
peak rate or congestion for shared packet delivery
Economic control loop around the TCP control loop to avoid congestion

17. Questions (1) How important are fixed regular bills to subscribers?
Can those needs be met adequately with rate-limited interfaces?
Will subscribers choose rationing in order to combine usage-priced services with fixed bills?

18. Questions (2)
Would enough subscribers choose a measured peak rate billing option for the peak computation to be worthwhile implementing in the router interface?
Are there enough subscribers who value low-cost, best-effort service to justify the development of congestion billing systems?

19. Questions (3)
Would any service provider actually deploy a system in which users bid for priority protection from congestion?
If under development, how many levels of precedence are needed? How are packets marked?