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Analysis of mutual relationships between investments made by content providers and network operators using the VAR model

ABSTRACT Various services and content available on the Internet have changed people’s daily lives and also changed the physical structure of the Internet network. Prominent content providers with high levels of Internet traffic by multimedia content have a significant influence on the structural changes of the Internet network. This study empirically analyzes the mutual relationships between the content providers’ infrastructure investments and the network operators’ network investments, using time-series data. It concludes that for the continuous development of Internet-related industries, it is necessary for the content providers to pay network interconnection fees to the network operators with paid peering contracts.