Next-Generation Strategic Business Model for the U.S. Internet Service Providers: Rate-Based Internet Subscription

Abstract

The (information digital) network bandwidth and its usage through Internet subscription, by far, is perhaps the only uni-modal commodity provided to today’s consumers at a flat rate. Regardless of his/her actual bandwidth usage, a consumer is charged a uniform subscription fee by the Internet Service Providers (ISP). Meanwhile, the ISPs have a considerable stake in the overall infrastructure which supports the local perimeters of the Internet. This article presents a rigorous statistical analysis with the objective of determining the optimal billing or pricing policy for the ISPs of the U.S. on the basis of the proposed ‘variable subscription-rate’ business model. Two leading global consumer profiles were selected for data comparison on a cardinal scale; NYC, NY, U.S.A. and Seoul, South Korea.