Responsive pricing modeled with Stackelberg game for next-generation networks

Abstract

In this paper, we study the problem of resource allocation between users in next-generation networks. The starting assumption is that the service provider tries to come up with convincing offers of service level to subscribers, based on demand responsive pricing scheme, while trying to maximize its profit. We developed two algorithms with different usage-based pricing strategies. Both algorithms solve pricing optimization problem using Stackelberg game with service provider acting as a leader and users behaving as followers. We developed the bandwidth management server to perform automatic optimal bandwidth allocation to each user's session and maximize its expected utility while maximizing the overall service provider's revenue. For both algorithms, we also performed the procedure for optimization of the capacity offered to users.

Dynamic pricing models in next generation networks

“…Funkcija dobiti koja odražava ponašanje delimi no elasti nih korisnika je logaritamska funkcija (Slika 2) i matemati ki se može predstaviti kao [5]:…”

“…U zavisnosti od zahtevanog kvaliteta servisa, svaki korisnik zahteva minimalni potrebni propusni opseg i maksimalni potrebni propusni opseg 1 [5]. 1 Maksimalni potrebni propusni opseg je minimalna vrednost zauzetog propusnog opsega dovoljna da osigura prenos informacija zahtevanim kvalitetom za dati sistem pod specificiranim uslovima.…”

“…Elasti ni korisnici su korisnici koji ne tolerišu gubitke ali mogu da prihvate kašnjenje u odre enoj meri. Za opisivanje njihovog zadovoljstva servisom koristi se logaritamska funkcija (Slika 3) [2], [5]. Za elasti ne korisnike se ne definiše donja granica propusnog opsega ve samo maksimalni potreban propusni opseg .…”

“…Svaki krug s se sastoji od jedne ili više iteracija koje obuhvataju nekoliko koraka. Oba algoritma konvergiraju brzo nakon nekoliko desetina krugova [5].…”

Pricing aspects of competition among service providers in next generation networks

“…General concepts in game theory and possible applications on pricing NGN services Game theory has been traditionally employed to analyze the behaviour of users in markets regulated by supply and demand. It is a good basis for the analysis of pricing problems in NGN [15]- [20]. Game theory describes and analyzes interactive decision making situations and consists of a set of analytical tools that predict the outcome of complex interactions among rational players.…”