Valuation for Buy-Back Agents

Although any valuation can be used for buy-back agents, we recommend that you use the Linear valuation, for two reasons:

• It is very easy to determine the amount of bandwidth “held back” by Linear valuation Buyer agents and the price at which they will release it. Use of Buyer agents with other valuations requires extensive modeling to ensure that they release the desired amount of bandwidth at the desired price points.
• It is relatively easy for “real” buyers to detect the presence and determine the settings for Linear buyers. One of the important features of Merkato is its openness¾the ability of buyers to view what all other buyers have offered for bandwidth, letting them optimize their strategy. If buyers can easily detect the price points at which more bandwidth is released to the market, they can incorporate that knowledge into their buying strategies. Also, the transparency of the Linear bidder’s settings allows the seller to change the price-point or quantities for these buyers notifying all buyers of the change.