Abstract
This chapter aims to provide new possibilities for service providers to enhance their revenues using the appropriate pricing scheme. Features and applicability of responsive pricing scheme and hybrid pricing for charging end users in next generation network are discussed. Game theory is used as an underlying concept for the implementation of pricing. In addition, transparent mapping of quality of service parameters to quality of business are considered, encompassing service price dependence on quality of service violation, which is consequently reflected on service provider's revenue.
TopBackground
Pricing with QoS guarantees has gained a strong momentum in telecommunication networks in past decade. It has led to a new interdisciplinary research area of “Telecommunication Economics”, which investigates telecommunication networks from an economical rather than from a technical perspective and allows innovative solutions in network management, control and pricing (Courcoubetis & Weber, 2003).
QoS describes the ability of a network to provide a service with an assured service level but it appears that in NGN QoS differentiation will not provide a suitable economic framework for the trade-off between quality delivered by SPs and willingness to pay from users’ side. QoE is an alternative framework for pricing service quality according to the user perception (ITU-T G.1011, 2013). It is affected not only by technical (i.e. QoS) aspects, but on non-technical aspects of service too, such as service set-up, content, price and customer support, which are essential for both QoE and QoBiz evaluation.
Key Terms in this Chapter
Next Generation Network (NGN): An architectural concept of future telecommunication core and access networks, which assumes transport of all information and services over a common network, typically built around the IP.
Quality of Service (QoS): A set of service requirements that a network should meet when transferring traffic flows.
Quality of Experience (QoE): The overall acceptability of an application or service, as perceived subjectively by the end-user.
Stackelberg Game: A strategic game in which at least one player is defined as the leader who can make a decision and commit a strategy before other players who are defined as followers.
Dynamic Pricing: The process of allocating the price as a cost per unit of resource consumption and according to level of QoS guarantees provided for the particular service class.
Quality of Business (QoBiz): A monetary value that matches the quality of delivered service, expressed through connection of QoS parameters with monetary value within the SLA.
Service Level Agreement (SLA): A contract between service providers or a service provider and a user, which defines responsibilities of all contracting parties, QoS guarantees, performance metrics, measurement methods and pricing principles.
Hybrid Pricing: The process of applying the static price in regular network operation mode while during congestion the dynamic pricing is enforced allowing deviations from contracted traffic profile.
Service Provider (SP): A general reference to an enterprise that provides telecommunication services to users.
Responsive Pricing: A pricing scheme which incorporates feedback generated by a network assuming that users are adaptive to the service price changes.