Pricing in Computer Networks : Motivation

We study the role of pricing policies in multiple service class networks. We rst argue that some form of service-class sensitive pricing is required in order for any multiclass service discipline to have the desired eeect. Borrowing heavily from the Nash implementation paradigm in economics, we then present an abstract formulation of service disciplines and pricing policies. This formulation allows us to describe more clearly the interplay between service disciplines and pricing policies. EEective multiclass service disciplines allow networks to focus resources on the performance sensitive applications, while eeective pricing policies allow us to spread the beneets of multiple service classes around to all users, rather than just having these beneets remain exclusively with the users of applications that are performance sensitive. Finally, we illustrate some of these concepts through simulation of several simple example networks. In our simulations, we nd that it is possible to set the prices so that users of every application type are more satissed with the combined cost and performance of a network with service-class sensitive prices. For some application types the performance penalty received for requesting a less-than-optimal service class is ooset by the reduced price of the service. For the other application types the monetary penalty incurred by using the more expensive, higher-quality service classes is ooset by the improved performance they receive. 4