Traditionally, engineers devised communication services without reference to how they should be priced. In today’s environment, pricing is a very complex subject and in practice depends on many parameters of the actual market including amount of traffic, architecture of the network, technology, and cost. The challenge is to provide a generic service model which accurately captures aspects such as quality and performance, and can be used to derive optimal pricing strategies. Recent technology advances, combined with the deregulation of the telecommunication market and the proliferation of the internet, have created a highly competitive environment for communication service providers. Pricing is no longer as simple as picking an appropriate model for a particular contract. There is a real need for a book that explains the provision of new services, the relation between pricing and resource allocation in networks; and the emergence of the internet and how to price it.
Pricing Communication Networks provides a framework of mathematical models for pricing these multidimensional contracts, and includes background in network services and contracts, network technology, basic economics, and pricing strategy. It can be used by economists to fill in the gaps in their knowledge of network services and technology, and for engineers and operational researchers to gain the background in economics required to price communication services effectively. It provides a broad overview of network services and contracts. It includes: a primer on modern network technology and the economic concepts relevant to pricing and competition; discussion of mathematical models of traffic flow to help describe network capability and derive pricing strategies; and, coverage of specialist topics, such as regulation, multicasting, and auctions. It is illustrated throughout by detailed real examples. It is suitable for anyone with an understanding of basic calculus and probability. Primarily aimed at graduate students, researchers and practitioners from electrical engineering, computer science, economics and operations research, Pricing Communication Networks will also appeal to telecomms engineers working in industry.