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Wi-Fi Economics

This project analyzes two pricing schemes commonly used in Wi-Fi markets: the flat-rate and the usage-based pricing. The flat-rate pricing encourages the maximum usage, while the usage-based pricing can flexibly attract more users especially those with low valuations in mobile Internet access. First, we use theoretical analysis to compare the two schemes and show that for a single provider in a market, as long as the Wi-Fi capacity is abundant, the flat-rate pricing leads to more revenue. Second, we study how a global provider (e.g., Skype) collaborates with this monopolist in each local market to provide a global Wi-Fi service. We formulate the interactions between the global and local providers as a dynamic game. In Stage I, the global provider bargains with the local provider in each market to determine the global Wi-Fi service price and revenue sharing agreement. In Stage II, local users and travelers choose local or global Wi-Fi services. We analytically show that the global provider prefers to use the usage-based pricing to avoid a severe competition with the local provider. At the equilibrium, the global provider always shares the majority of his revenue with the local provider to incentivize the cooperation. Finally, we analytically study how the interaction changes if the local market has more than one local provider. In this case, the global provider can integrate the coverage of multiple local providers and provide a better service. Compared to the local monopoly case, local market competition enables the global provider to share less revenue with each of the local providers. However, we numerically show that the global provider’s revenue could decrease, as he shares his revenue with more providers and can only charge a lower price.
 
 
 
 
 
 
 
 
Project Team

NCEL Members: Man Hon Cheung, Lingjie Duan, Lin Gao,  Jianwei Huang, Haoran Yu
Collaborators: Biying Shou (City University of Hong Kong)

 
 
 
References
In Press
Ma, Qian, et al. "Incentivizing Wi-Fi Network Crowdsourcing: A Contract Theoretic Approach." IEEE/ACM Transactions on Networking (In Press). Download: 08350371.pdf (2.08 MB)
2017
Yu, Haoran, et al. "Public Wi-Fi monetization via advertising." IEEE/ACM Transactions on Networking. 25.4 (2017): 2110-2121. Download: 07879333.pdf (2.17 MB)
Yu, Haoran, et al. "Auction-based coopetition between LTE unlicensed and Wi-Fi." IEEE Journal on Selected Areas in Communications. 35.1 (2017): 79-90. Download: 07756317.pdf (1.58 MB)
Yu, Haoran, Man Cheung, and Jianwei Huang. "Cooperative Wi-Fi deployment: A one-to-many bargaining framework." IEEE Transactions on Mobile Computing. 16.6 (2017): 1536-1233. Download: 07539609.pdf (1.17 MB)
Ma, Qian, et al. "Economic Analysis of Crowdsourced Wireless Community Networks." IEEE Transactions on Mobile Computing. 16.7 (2017): 1856-1869. Download: 07562462.pdf (461.12 KB)
2016
Ma, Qian, et al. A Contract-Based Incentive Mechanism for Crowdsourced Wireless Community Networks. International Symposium on Modeling and Optimization in Mobile, Ad Hoc and Wireless Networks (WiOpt). Tempe, AZ, USA, 2016. Download: p414-ma.pdf (285.32 KB)
Yu, Haoran, et al. Coopetition between LTE Unlicensed and Wi-Fi: A Reverse Auction with Allocative Externalities. International Symposium on Modeling and Optimization in Mobile, Ad Hoc and Wireless Networks (WiOpt). Tempe, AZ, USA, 2016. Download: p406-yu.pdf (484.03 KB)
Yu, Haoran, et al. Economics of Public Wi-Fi Monetization and Advertising. IEEE International Conference on Computer Communications (INFOCOM - A Best Paper Award candidate and fast track publication to IEEE/ACM Transactions on Networking). San Francisco, CA, USA, 2016. Download: p2052-yu.pdf (800.51 KB)
2015
Duan, Lingjie, Biying Shou, and Jianwei Huang. "Pricing for Local and Global WiFi Markets." IEEE Transaction on Mobile Computing. 14.5 (2015). Download: SkypeWiFi_TMC_2014.pdf (5.5 MB)
2013
Duan, Lingjie, Jianwei Huang, and Biying Shou Optimal Pricing for Local and Global WiFi Markets. IEEE INFOCOM. Turin, Italy, 2013. Download: 1569647387.pdf (1016.92 KB)

 

 

 

 

 



story | by Dr. Radut