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Content Provider Contributions to Capacity Expansion of a Neutral ISP: Effect of Private Option

Pranay Agarwal, D. Manjunath

TL;DR

This paper analyzes how content providers (CPs) contribute to capacity expansion of a neutral ISP through public investments while also allowing private investments that improve each CP’s own QoS. It develops a two-part investment model with concave QoS gains and analyzes both centralized allocation and non-cooperative game settings, deriving closed-form expressions for optimal investments and characterizing the public-private trade-off $\gamma$. A key finding is that in the non-cooperative regime, at most one CP makes a positive public investment unless CPs are symmetric, with the price of anarchy $\eta$ generally exceeding 1; bargaining and cooperative outcomes can align with centralized results under certain conditions. The results offer insight into incentive structures for CP funding of network upgrades and have implications for net neutrality and policy design in multi-CP environments.

Abstract

Increasing content consumption by users and the expectation of a better Internet experience requires Internet service providers (ISPs) to expand the capacity of the access network continually. The ISPs have been demanding the participation of the content providers (CPs) in sharing the cost of upgrading the infrastructure. From CPs' perspective, investing in the ISP infrastructure, termed as \emph{public investment}, seems rational as it will boost their profit. However, the CPs can alternatively invest in making content delivery more efficient, termed as \emph{private investment}, as it also boosts their profit. Thus, in this work, we investigate this trade-off between public and private investment of the CPs for a net-neutral ISP. Specifically, we consider centralized decision and non-cooperative forms of interaction between CPs and an ISP and determine the optimum public and private investments of the CPs for each model. In the non-cooperative interaction, we find that at most one CP contributes to the public infrastructure, whereas all invest in their private infrastructure.

Content Provider Contributions to Capacity Expansion of a Neutral ISP: Effect of Private Option

TL;DR

This paper analyzes how content providers (CPs) contribute to capacity expansion of a neutral ISP through public investments while also allowing private investments that improve each CP’s own QoS. It develops a two-part investment model with concave QoS gains and analyzes both centralized allocation and non-cooperative game settings, deriving closed-form expressions for optimal investments and characterizing the public-private trade-off . A key finding is that in the non-cooperative regime, at most one CP makes a positive public investment unless CPs are symmetric, with the price of anarchy generally exceeding 1; bargaining and cooperative outcomes can align with centralized results under certain conditions. The results offer insight into incentive structures for CP funding of network upgrades and have implications for net neutrality and policy design in multi-CP environments.

Abstract

Increasing content consumption by users and the expectation of a better Internet experience requires Internet service providers (ISPs) to expand the capacity of the access network continually. The ISPs have been demanding the participation of the content providers (CPs) in sharing the cost of upgrading the infrastructure. From CPs' perspective, investing in the ISP infrastructure, termed as \emph{public investment}, seems rational as it will boost their profit. However, the CPs can alternatively invest in making content delivery more efficient, termed as \emph{private investment}, as it also boosts their profit. Thus, in this work, we investigate this trade-off between public and private investment of the CPs for a net-neutral ISP. Specifically, we consider centralized decision and non-cooperative forms of interaction between CPs and an ISP and determine the optimum public and private investments of the CPs for each model. In the non-cooperative interaction, we find that at most one CP contributes to the public infrastructure, whereas all invest in their private infrastructure.
Paper Structure (13 sections, 5 theorems, 40 equations, 4 figures)

This paper contains 13 sections, 5 theorems, 40 equations, 4 figures.

Table of Contents

  1. Introduction
  2. Related Literature
  3. Problem Setup and Preview
  4. System Model
  5. Centralized Allocation
  6. Non-Cooperative Interaction
  7. Numerical Results
  8. Conclusions and Future Works
  9. Proof of Lemma \ref{['lem:opti_pn']}
  10. Proof of Lemma \ref{['lem:lemma_coop']}
  11. Proof of Theorem \ref{['thm:coop_gamma']}
  12. Proof of Theorem \ref{['thm:NC']}
  13. Proof of Theorem \ref{['thm:PoA']}

Key Result

Lemma 1

The optimum value of $p_{n}$ for a given value of $Q$, denoted by $p_{n}^{\ast}(Q)$, is given by

Figures (4)

  • Figure 1: Variation of optimum total public investment, optimum total private investment, and public-private trade-off against different values of $\delta$ and $\textbf{b}$ for centralized game and $N=2$ in (a), (b), and (c), respectively.
  • Figure 2: Variation of optimum total public investment, optimum total private investment, and public-private trade-off against different values of $\delta$ and $\textbf{b}$ for centralized game and $N=5$ in (a), (b), and (c), respectively.
  • Figure 3: Illustration of the price of anarchy ($\eta$), $\Gamma$, and the public-private trade-off in non-cooperative interaction ($\gamma_{N}$) against different values of $\psi_{n}(=r_{n}a_{n})$ for $N=2$ and $\textbf{b}=[1, 1]$ in (a), (b), and (c), respectively.
  • Figure 4: Illustration of the price of anarchy ($\eta$), $\Gamma$, and the public-private trade-off in non-cooperative interaction ($\gamma_{N}$) against different values of $\psi_{n}(=r_{n}a_{n})$ for $N=2$ and $\textbf{b}=[2, 2]$ in (a), (b), and (c), respectively.

Theorems & Definitions (13)

  • Remark 1
  • Remark 2
  • Lemma 1
  • Remark 3
  • Lemma 2
  • Theorem 1
  • Theorem 2
  • Theorem 3
  • proof
  • proof
  • ...and 3 more