Network Non-Neutrality on the Internet: Content Provision Under a Subscription Revenue Model

The goal of this paper is to provide an insight into the equi-librium of the Internet market, when the current balance of the market is disrupted, and one of the ISPs switches to a non-neutral regime. We consider a content provider with a subscription revenue model and a continuum of end-users. The CP is also non-neutral, in the sense that she can charge users of different ISPs different subscription fees, and use this “leverage ” to control the equilibrium outcome. Results reveal that the CP is able to control the non-neutral ISP to some extend. However, switching to a non-neutral regime by an ISP tips the balance of the market in favor of this ISP. 1