Connectivity in the Commercial Internet

TLDR

The study examines the backbone market of the Internet. The authors extend the Katz‑Shapiro network model to analyze the strategic choices of dominant backbone providers. They model a targeted degradation strategy in which a larger backbone reduces interconnection quality to smaller rivals. The analysis shows that larger backbones favor lower‑quality interconnections and that these results hold even when clients multihome.

Abstract

We study the ‘backbone market’ in the Internet. After discussing the structure of the Internet, we use an extension of the Katz‐Shapiro network model to analyze the strategies that would be used by dominant backbone. We show that a larger backbone prefers a lower quality interconnection than the smaller one. We then analyze a ‘targeted degradation’ strategy where the larger backbone lowers the quality of interconnection to its smaller rivals in turn. Finally, we show that the qualitative results are robust to the possibility of ‘multihoming’ by clients.