Com479studyguide - -Types of networks-interpersonal-infrastructure-Characteristics of infrastructure networks-capital intensive long gestation long

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-Types of networks -interpersonal -infrastructure -Characteristics of infrastructure networks -capital intensive, long gestation, long useful life, long depreciation period, scalable and modular, public or regulated private monopoly, hierarchal architecture, network externalities -Last mile problem is not about cost, but efficiency of use. Ex) Business user $100/4.5= $22 vs. Home user $100/3.1= $32 -AC=TC/Q -Demand aggregation is possible at higher levels of hierarchy. Ex) a work user customer uses more than a home ser customer -Telephone architecture -star, & tree and branch (both have 13 strands all together -Positive network effects are obvious. More people, means more interaction. Ex) Wikipedia itself depends on positive network effects -Negative network effects result from resource limits. Ex) automobile and Ethernet congestion. This illustrate that there can be threshold limits. Another negative network effect is provider complacency. The absence of successful competitors in a successful network can cause a provider to restrict resources, consider fee increases, or otherwise create an environment contrary to the users' benefit. Ex) US Postal Service or Telephone companies -n.(n-1)/2 -If utility is proportional to # of persons you can call then U=k.n.(n-1) -Natural monopoly -Declining average costs – aka economys a scale -Cost sub-additively – it is easier to combine 2 quantities within companies rather then 2 separate companies -C(q1)+C(q2)>C(q1+q2) -Characteristics of non-hierarchal networks -massive redundancy, robustness, indeterminate peering relationships, uses more computational power (packet switching), more expensive
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This note was uploaded on 03/30/2008 for the course COMM 479 taught by Professor Krishnajayakar during the Spring '08 term at Pennsylvania State University, University Park.

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Com479studyguide - -Types of networks-interpersonal-infrastructure-Characteristics of infrastructure networks-capital intensive long gestation long

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