Duopoly Competition in Time-Dependent Pricing for Improving Revenue of Network Service Providers

Cheng ZHANG; Bo GU; Kyoko YAMORI; Sugang XU; Yoshiaki TANAKA

doi:10.1587/transcom.E96.B.2964

Duopoly Competition in Time-Dependent Pricing for Improving Revenue of Network Service Providers

Cheng ZHANG, Bo GU, Kyoko YAMORI, Sugang XU, Yoshiaki TANAKA

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Due to network users' different time-preference, network traffic load usually significantly differs at different time. In traffic peak time, network congestion may happen, which make the quality of service for network users deteriorate. There are essentially two ways to improve the quality of services in this case: (1) Network service providers (NSPs) over-provision network capacity by investment; (2) NSPs use time-dependent pricing (TDP) to reduce the traffic at traffic peak time. However, over-provisioning network capacity can be costly. Therefore, some researchers have proposed TDP to control congestion as well as improve the revenue of NSP. But to the best of our knowledge, all of the literature related time-dependent pricing scheme only consider the monopoly NSP case. In this paper, a duopoly NSP case is studied. The NSPs try to maximize their overall revenue by setting time-dependent price, while users choose NSP by considering their own preference, congestion status in the networks and the price set by the NSPs. Analytical and experimental results show that the TDP benefits the NSPs, but the revenue improvement is limited due to the competition effect.

Publication: IEICE TRANSACTIONS on Communications Vol.E96-B No.12 pp.2964-2975

Publication Date: 2013/12/01

Publicized

Online ISSN: 1745-1345

DOI: 10.1587/transcom.E96.B.2964

Type of Manuscript: Special Section PAPER (Special Section on Network and System Technologies for Sustainable Society)

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Authors

Cheng ZHANG
  Waseda University
Bo GU
  Waseda University
Kyoko YAMORI
  Asahi University,Waseda University
Sugang XU
  Waseda University
Yoshiaki TANAKA
  Waseda University

Keyword

time-dependent pricing, revenue maximization, duopoly competition

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Cheng ZHANG, Bo GU, Kyoko YAMORI, Sugang XU, Yoshiaki TANAKA, "Duopoly Competition in Time-Dependent Pricing for Improving Revenue of Network Service Providers" in IEICE TRANSACTIONS on Communications, vol. E96-B, no. 12, pp. 2964-2975, December 2013, doi: 10.1587/transcom.E96.B.2964.
Abstract: Due to network users' different time-preference, network traffic load usually significantly differs at different time. In traffic peak time, network congestion may happen, which make the quality of service for network users deteriorate. There are essentially two ways to improve the quality of services in this case: (1) Network service providers (NSPs) over-provision network capacity by investment; (2) NSPs use time-dependent pricing (TDP) to reduce the traffic at traffic peak time. However, over-provisioning network capacity can be costly. Therefore, some researchers have proposed TDP to control congestion as well as improve the revenue of NSP. But to the best of our knowledge, all of the literature related time-dependent pricing scheme only consider the monopoly NSP case. In this paper, a duopoly NSP case is studied. The NSPs try to maximize their overall revenue by setting time-dependent price, while users choose NSP by considering their own preference, congestion status in the networks and the price set by the NSPs. Analytical and experimental results show that the TDP benefits the NSPs, but the revenue improvement is limited due to the competition effect.
URL: https://globals.ieice.org/en_transactions/communications/10.1587/transcom.E96.B.2964/_p

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@ARTICLE{e96-b_12_2964,
author={Cheng ZHANG, Bo GU, Kyoko YAMORI, Sugang XU, Yoshiaki TANAKA, },
journal={IEICE TRANSACTIONS on Communications},
title={Duopoly Competition in Time-Dependent Pricing for Improving Revenue of Network Service Providers},
year={2013},
volume={E96-B},
number={12},
pages={2964-2975},
abstract={Due to network users' different time-preference, network traffic load usually significantly differs at different time. In traffic peak time, network congestion may happen, which make the quality of service for network users deteriorate. There are essentially two ways to improve the quality of services in this case: (1) Network service providers (NSPs) over-provision network capacity by investment; (2) NSPs use time-dependent pricing (TDP) to reduce the traffic at traffic peak time. However, over-provisioning network capacity can be costly. Therefore, some researchers have proposed TDP to control congestion as well as improve the revenue of NSP. But to the best of our knowledge, all of the literature related time-dependent pricing scheme only consider the monopoly NSP case. In this paper, a duopoly NSP case is studied. The NSPs try to maximize their overall revenue by setting time-dependent price, while users choose NSP by considering their own preference, congestion status in the networks and the price set by the NSPs. Analytical and experimental results show that the TDP benefits the NSPs, but the revenue improvement is limited due to the competition effect.},
keywords={},
doi={10.1587/transcom.E96.B.2964},
ISSN={1745-1345},
month={December},}

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TY - JOUR
TI - Duopoly Competition in Time-Dependent Pricing for Improving Revenue of Network Service Providers
T2 - IEICE TRANSACTIONS on Communications
SP - 2964
EP - 2975
AU - Cheng ZHANG
AU - Bo GU
AU - Kyoko YAMORI
AU - Sugang XU
AU - Yoshiaki TANAKA
PY - 2013
DO - 10.1587/transcom.E96.B.2964
JO - IEICE TRANSACTIONS on Communications
SN - 1745-1345
VL - E96-B
IS - 12
JA - IEICE TRANSACTIONS on Communications
Y1 - December 2013
AB - Due to network users' different time-preference, network traffic load usually significantly differs at different time. In traffic peak time, network congestion may happen, which make the quality of service for network users deteriorate. There are essentially two ways to improve the quality of services in this case: (1) Network service providers (NSPs) over-provision network capacity by investment; (2) NSPs use time-dependent pricing (TDP) to reduce the traffic at traffic peak time. However, over-provisioning network capacity can be costly. Therefore, some researchers have proposed TDP to control congestion as well as improve the revenue of NSP. But to the best of our knowledge, all of the literature related time-dependent pricing scheme only consider the monopoly NSP case. In this paper, a duopoly NSP case is studied. The NSPs try to maximize their overall revenue by setting time-dependent price, while users choose NSP by considering their own preference, congestion status in the networks and the price set by the NSPs. Analytical and experimental results show that the TDP benefits the NSPs, but the revenue improvement is limited due to the competition effect.
ER -