Pricing Communication Networks : Economics, Technology and Modelling

Recent advances in technology, combined with the deregulation of the telecommunication market and the proliferation of the Internet, have created a highly competitive environment for communication service providers. There is no simple recipe for pricing network service contracts in all contexts. Pricing is a complex subject, which depends on parameters of the actual market - including the degree of competition and customer demand - and parameters of technology, such as resource consumption, network architecture, resource availability, and cost.

Pricing Communication Networks: Economics, Technology and Modelling covers many important issues in providing new services, the relation between pricing and resource allocation in networks, and the emergence of the Internet and its pricing. It provides a framework of mathematical models for pricing multidimensional contracts with quality of service guarantees, and includes a useful background on network services and contracts, network technology, basic economics, and pricing strategy.

• Provides a broad overview of network services and contracts.

• Includes a primer on modern network technology and the economic concepts relevant to pricing and competition.

• Discusses mathematical models for multiplexing bursty traffic flows, and applies these to measuring network capability and deriving pricing strategies for services with statistical quality guarantees.

• Discusses definitions of cost for communication networks and explains the intricacies of cost-based pricing.

• Explains congestion pricing and its potential applications in the Internet.

• Illustrated throughout by detailed examples and figures.

• Includes coverage of specialist topics, such as regulation, multicasting, interconnection, and auctions.

Pricing Communication Networks: Economics, Technology and Modelling is an essential reference for graduate students, researchers and practitioners from electrical engineering, computer science, economics and operations research. It can be used by economists to fill in the gaps in their knowledge of network services and technology and by engineers and operational researchers to gain the background in the economics that is required to understand how to price communication networks effectively.

Table of Contents

Preface.

List of Acronyms.

A: NETWORKS.

Pricing and Communications Networks.

Network Services and Contracts.

Network Technology.

Network Constraints and Effective Bandwidths.

B: ECONOMICS.

Basic Concepts.

Competition Models.

C: PRICING.

Cost-based Pricing.

Charging Guaranteed Services.

Congestion.

Charging Flexible Contracts.

D: SPECIAL TOPICS.

Multicasting.

Interconnection.

Regulation.

Auctions.

Appendix A: Lagrangian Methods for Constrained Optimization.

Appendix B: Convergence of Tatonnement.

References.

Index.