Interaction of ISPs Distributed Resource Allocation and Revenue

Interaction of ISPs: Distributed Resource Allocation and Revenue Maximization Sam C. M. Lee, Joe W. J. Jiang, John C. S. Lui The Chinese University of Hong Kong

Tier-1 ISP Tier-2 ISP Local ISP Peering link

Tier-2 ISPISP Local ISP Peering link ISP link Peer ISP Peer

Optimization problem of peers Peer i Tier-2 ISP (ISP) Peer j Issues to consider: 1. performance of the link 2. charge of the link Peer k

Optimization problem of peers Happiness obtained from sending traffic to peers Delay cost in ISP link Payment to ISP Delay costs in peering links Payments to peers

Constraints of peers 1. 2. 3. 4.

Solution to the peers • Objective function is strictly concave in every transmission rate • The optimal transmission rates and maximum utility are unique and can be found by Lagrangian method

Problems for an ISP • Resource distribution – How to determine the capacity for the peers • Maximization of revenue – How to determine the optimal value of unit price

Information exchange framework Next period Bandwidth allocation Bid ISP peer Compute resource distribution Compute optimal rates

ISP 1: Resource distribution ISP ? ? Bandwidth = 600 MBps ? peer 1 peer 2 peer 3 Bid = 50 MBps Bid = 100 MBps Bid = 150 MBps

Proportional share algorithm ISP 100 MBps Bandwidth = 600 MBps 200 MBps 300 MBps peer 1 peer 2 peer 3 Bid = 50 MBps Bid = 100 MBps Bid = 150 MBps

Equal share algorithm ISP 150 MBps Bandwidth = 600 MBps 250 MBps peer 1 peer 2 peer 3 Bid = 50 MBps Bid = 100 MBps Bid = 150 MBps

Simulations • When the happiness coefficients of peers are low PSA ESA

• When the happiness coefficients of peers are high PSA ESA

ISP 2: Maximization of Revenue Total revenue Demand Unit price from bythe peers i Determine the optimal price

Solution: Maximization of revenue • Estimate the aggregate traffic ( peers in term of the price (P) ) from all

Conclusions • Utility maximization of a peer • Resource distribution of ISP • Revenue maximization of ISP

Q&A