This editorial introduces the special issue on the economics of security and privacy.

Mobile data traffic has been steadily rising in the past years. This has generated a significant interest in the deployment of incentive mechanisms to reduce peak-time congestion. Typically, the design of these mechanisms requires information about user demand and sensitivity to prices. Such information is naturally imperfect. In this paper, we propose a fixed-budget rebate mechanism that gives each user a reward proportional to his percentage contribution to the aggregate reduction in peak-time demand. For comparison, we also study a time-of-day pricing mechanism that gives each user a fixed reward per unit reduction of his peak-time demand. To evaluate the two mechanisms, we introduce a game-theoretic model that captures the public good nature of decongestion. For each mechanism, we demonstrate that the socially optimal level of decongestion is achievable for a specific choice of the mechanism's parameter. We then investigate how imperfect information about user demand affects the mechanisms' effectiveness. From our results, the fixed-budget rebate pricing is more robust when the users' sensitivity to congestion is “sufficiently” convex. This feature of the fixed-budget rebate mechanism is attractive for many situations of interest and is driven by its closed-loop property, i.e., the unit reward decreases as the peak-time demand decreases.

Networking researchers complain that the current Internet is ossified, i.e. that it can hardly be changed. We believe that one of the fundamental reasons for that is the lack of appropriate incentives for providers to invest in new technology, especially in the absence of a compelling new architecture and a killer application that would benefit from an alternative architecture. There is a chicken-and-egg problem: In order to come up with exciting new applications, there needs to be an infrastructure supporting them. Researchers have proposed to build network testbeds (e.g. GENI/FIRE) to test new network architectures and protocols at larger scale. However, these testbeds appear to have little attraction for users, in particular for commercially oriented application developers. OpenFlow is an alternative approach enabling experimental protocols in production networks. However, one of its limitations is lack of addressing provider incentives. In this position paper, we therefore sketch the characteristics that we think a new Internet platform should have in order to be compelling. We argue for a platform that offers rich programmability at low performance cost and that separates traffic to enhance security and limit interference among applications. Moreover, the platform should be open and accessible to a wide community of users and have a high usability in terms of being easily programmable by application developers. Finally, we believe the new platform should provide support for running sophisticated applications across multiple provider domains.

This paper investigates Internet service provider (ISP) incentives with a single-service class and with two-service classes in the Internet. We consider multiple competing ISPs who offer network access to a fixed user base, consisting of end-users who differ in their quality requirements and willingness to pay for the access. We model user-ISP interactions as a game in which each ISP makes capacity and pricing decisions to maximize its profits and the end-users only decide which service to buy (if any) and from which ISP. Our model provides pricing for networks with single- and two-service classes for any number of competing ISPs. Our results indicate that multiple service classes are socially desirable, but could be blocked due to the unfavorable distributional consequences that it inflicts on the existing Internet users. We propose a simple regulatory tool to alleviate the political economic constraints and thus make multiple service classes in the Internet feasible.