The role of customer-premises bandwidth management

Concerns the economics of customer-premises agents that manage the bandwidth demanded by next-generation, high-speed networks. Models are proposed for the hypothetical prices of SONET and ATM telecommunication services. The ATM model builds on the SONET model, splitting the leased-line price into two components/spl mdash/a traffic-insensitive charge for port and access fees and a traffic-sensitive charge for delivering cells through the network/spl mdash/which are balanced so as to make the cost of ATM service at a pre-determined level of network utilization equal to the cost of a leased line. The models are extended to incorporate the rate at which transmission prices are expected to fall over time, the rate at which link traffic is expected to grow, and the degree of bandwidth conservation offered by the management system. The results show net economic efficiency over a wide range of circumstances, thereby suggesting the continued usefulness of customer-premises bandwidth management well into the future.<>