Abstract This paper analyzes the effects of direct interconnection agreements in the Internet backbone on content quality investment for content providers (CPs). The model assumes that when the Internet service provider (ISP) has a vertical affiliation with one CP, the ISP directly interconnects the affiliated CP’s traffic to its network for free while collecting a direct interconnection fee from the unaffiliated CP. If the unaffiliated CP’s traffic is indirectly interconnected to the ISP’s network via a third party transit provider, its network quality is lower than that via a direct interconnection. For the CPs’ content quality investments, I find that the affiliated CP invests more in content when the rival indirectly interconnects, leading to a higher total level of content investment. Accordingly, there is a condition under which the ISP does not want to offer direct interconnection to the unaffiliated CP. However, consumers are not always worse off from this interconnection foreclosure. Thus, the regulation of a paid direct interconnection does not necessarily enhance welfare in terms of consumer surplus.

中文翻译：

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内容质量的直接互连和投资激励

摘要本文分析了Internet主干网中的直接互连协议对内容提供商（CP）的内容质量投资的影响。该模型假定，当Internet服务提供商（ISP）与一个CP具有垂直联属关系时，ISP将免费将关联CP的流量直接互连到其网络，同时从非关联CP收取直接互连费。如果未关联的CP的流量通过第三方转接提供程序间接互连到ISP的网络，则其网络质量将低于通过直接互连的网络质量。对于CP的内容质量投资，我发现当竞争对手间接互连时，关联的CP会在内容上投入更多，从而导致更高的内容投资总额。因此，在某些情况下，ISP不想提供与非附属CP的直接互连。但是，消费者并不总是会因这种互连止赎而变得更糟。因此，对有偿直接互连的监管并不一定会提高消费者剩余方面的福利。