Instructor: Kemal Altinkemer
Course Description:
This new course encompasses pricing the Infrastructure
of Electronic Commerce, bundling of Information goods,
pricing of these bundles, and models of Web server pricing.
It will include usage based pricing suggested for the
Next Generation Internet, and Internet 2. Other pricing
methods will be priority based pricing, priority based
pricing with Quality of Service (QoS) guarantees. In the future the Internet
might carry voice, data, and image over the same channel
based on the Internet technology: packet switching which
will require priority pricing with QoS guarantees.
With the proliferation of the Internet we see more and
more Information goods which are defined as electronic
information where the fixed cost of producing is high,
however marginal cost is almost zero. These goods are
newspaper, journal articles, music downloadable software
and similar items. Washington Post, Microsoft, NBC, MSNBC
have a strategic pact to produce information goods. Bundling
of such goods could be significant, quantity and/or time
based bundling. Pricing of such goods brings interesting
challenges to Web managers.
Web servers, such as for E-banking, could be analyzed
in various ways. Fixed pricing, no pricing, priority
pricing, priority pricing with QoS guarantees, expost,
exante pricing, and dynamic pricing are some pricing
techniques that have been suggested so far. It could
be modeled as M(x)/G/c/N/ queues with vacation
times and retrial customers. The course is devoted to
studying such issues in an E-commerce environment.
The financial intermediaries on the Internet such as
E*trade, Charles Scwab will also be studied. Anonymity
and the value of anonymity on some applications will
be analyzed. Auctions and bidding (a popular selling
mechanism as used by Amazon.com,) reverse auction, and
the business model of Priceline.com will be discussed.
The course will
be based on Economics, Optimization, Stochastic Processes,
and Queuing Theory.
Requirement: permission of the instructor.
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