Publication

Optimal Pricing Strategy for Wireless Social Community Networks

Abstract

The increasing number of mobile applications fuels the demand for affordable and ubiquitous wireless access. The traditional wireless network technologies such as EV-DO or WiMAX provide this service but require a huge upfront investment in infrastructure and spectrum. On the contrary, as they do not have to face such an investment, social community operators rely on subscribers who constitute a community of users. The pricing strategy of the provided wireless access is an open problem for this new generation of wireless access providers. In this paper, using both analytical and simulation approaches, we study the problem comprised of modeling user subscription and mobility behavior and of coverage evolution with the objective of finding optimal subscription fees. We compute optimal prices for wireless social community networks with both static and semi-dynamic pricing. Coping with an incomplete knowledge about users, we calculate the best static price and prove that optimal fair pricing is the optimal semi-dynamic pricing for social community operators in monopoly situations. Moreover, we have developed a simulator to verify optimal prices of social community operators with complete and incomplete knowledge. Our simulation results show that the optimal fair pricing strategy significantly improves the cumulative payoff of social community operators.

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Ontological neighbourhood
Related concepts (37)
Pricing strategies
A business can use a variety of pricing strategies when selling a product or service. To determine the most effective pricing strategy for a company, senior executives need to first identify the company's pricing position, pricing segment, pricing capability and their competitive pricing reaction strategy. Pricing strategies and tactics vary from company to company, and also differ across countries, cultures, industries and over time, with the maturing of industries and markets and changes in wider economic conditions.
Optimal control
Optimal control theory is a branch of mathematical optimization that deals with finding a control for a dynamical system over a period of time such that an objective function is optimized. It has numerous applications in science, engineering and operations research. For example, the dynamical system might be a spacecraft with controls corresponding to rocket thrusters, and the objective might be to reach the moon with minimum fuel expenditure.
Wireless community network
Wireless community networks or wireless community projects or simply community networks, are non-centralized, self-managed and collaborative networks organized in a grassroots fashion by communities, non-governmental organizations and cooperatives in order to provide a viable alternative to municipal wireless networks for consumers. Many of these organizations set up wireless mesh networks which rely primarily on sharing of unmetered residential and business DSL and cable Internet.
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