A Two-component Spot Pricing Framework for Loss-rate Guaranteed Internet Service Contracts
نویسندگان
چکیده
The technological advances in recent years are allowing Internet Service Providers (ISPs) to provide Quality of Service (QoS) assurance for traffic through their domains. This article develops a spot pricing framework for intra-domain expected bandwidth contract with'a loss based QoS guarantee. The framework accounts for both the cost and the risks associated with QoS delivery. A nonlinear pricing scheme is used in pricing for cost recovery; a utility based options pricing approach is developed for risk related pricing. The application of options pricing in intemet services provides a mechanism for fair risk sharing between the provider and the customer, and may be extended to price other uncertainties in QoS guarantees.
منابع مشابه
Pricing of risk for loss guaranteed intra-domain internet service contracts
The Internet today offers primarily a best-effort service. Research and technology development efforts are currently underway to allow provisioning of better than besteffort Quality of Service (QoS) assurances. In this article, we develop a spot pricing framework for intradomain expected bandwidth contracts with loss based QoS guarantees. The framework builds on a nonlinear pricing scheme for c...
متن کاملA Spot Pricing Framework to Enable Pricing and Risk Management of Inter-Domain Assured Bandwidth Services
In the current bandwidth market, Internet Service Providers (ISPs) provide guaranteed Internet bandwidth within their domains. However, they are incapable of providing such assurances for data crossing their domain boundaries. In this paper, we present a spot pricing scheme for Internet bandwidth contracts within an ISP domain. These models when implemented at access or exchange points of diffe...
متن کاملPricing of Futures Contracts by Considering Stochastic Exponential Jump Domain of Spot Price
Derivatives are alternative financial instruments which extend traders opportunities to achieve some financial goals. They are risk management instruments that are related to a data in the future, and also they react to uncertain prices. Study on pricing futures can provide useful tools to understand the stochastic behavior of prices to manage the risk of price volatility. Thus, this study eval...
متن کاملA Spot Pricing Framework For Pricing Intra-Domain Assured Bandwidth Services
The Internet today offers primarily a best-effort service. Research and development efforts are currently underway to allow the provision of better than best-effort quality of service assurances. In this article we develop a spot-pricing framework for bandwidth assured Internet service contracts. A nonlinear pricing model forms the basis for the framework. The price process is obtained for diff...
متن کاملPath-vector contracting: Profit maximization and risk management
1389-1286/$ see front matter 2011 Elsevier B.V doi:10.1016/j.comnet.2011.11.004 ⇑ Corresponding author. E-mail addresses: [email protected] (P.K. Mut rpi.edu (A. Gupta), [email protected] (M. Yuksel), We consider an Internet Service Provider’s (ISP’s) problem of providing end-to-end (e2e) services with bandwidth guarantees, using a path-vector based approach. In this approach, an ISP uses its edg...
متن کامل