Can carriers make more profit while users save money?

In this work, we investigate the profit maximization problem for wireless network carriers and payment minimization for end users. Motivated by our recent findings on proactive resource allocation, we focus on the scenario whereby end users harness predictable demand and WiFi connectivity in proactive data downloads, to minimize their expected payments. Carriers, on the other hand, utilize smart pricing schemes to differentiate between the off-peak and peak hour prices so as to reduce peak costs and maximize their profit.We formulate the tension between the carrier and end user as a two-player Stackelberg game in which the carrier assigns prices first, then the end user responds with optimized proactive downloads. We explore the equilibrium points under maximum and average price constraints, and study the impact of WiFi availability on the system´s performance. In particular, we compare the new equilibria with the baseline scenario of flat pricing and no proactive downloads. Despite the potential uncertainty about future demand, and the freshness of proactively downloaded content, we characterize new equilibria points that yield win-win situation with respect to the baseline equilibrium.