WLAN Service Providers´ Price Competition with Uncertainty in User Demand

Author

Kumar, Ajit ; Mallik, Ranjan K. ; Schober, Robert

Author_Institution

Dept. of Electr. Eng., Indian Inst. of Technol.-Delhi, New Delhi, India

Volume

17

Issue

3

fYear

2013

fDate

Mar-13

Firstpage

517

Lastpage

520

Abstract

In this letter, uncertainty in users´ network selection is modeled by a Markov chain. In the presence of such uncertainty, the price competition game of wireless local area network (WLAN) service providers (SPs) is analyzed and the existence of Bayesian Nash equilibrium is proved. Using the price of anarchy as a metric of efficiency for social welfare maximization, it is shown that an increase in competition does not result in significant losses in efficiency. Compared to a monopoly, an unregulated duopoly of WLAN SPs is recommended as it results in a more equitable distribution of surplus amongst the SPs and the users.

Keywords

Markov processes; game theory; wireless LAN; Bayesian Nash equilibrium; Markov chain; WLAN; service providers´ price competition; social welfare maximization; users´ network selection; wireless local area network service providers; Bayesian methods; Games; Monopoly; Steady-state; Uncertainty; Vectors; Wireless LAN; Price competition; price of anarchy (PoA); service provider (SP); wireless local area network (WLAN);

fLanguage

English

Journal_Title

Communications Letters, IEEE

Publisher

ieee

ISSN

1089-7798

Type

jour

DOI

10.1109/LCOMM.2013.020513.122647

Filename

6459501