Real-Time Market Model for Pricing Differentiated Services

Pricing network resources is a crucial component for proper resource management and the provision of quality of service guarantees. In this paper we propose a decentralized real-time market (RTM) model for pricing differentiated services (DiffServ), which attempts to achieve efficient resource allocation, while reducing computational overheads. We review issues relating to congestion sensitive pricing of the network resources and propose an approach to alleviate price fluctuation that considers the actual state of the network. In comparison with the existing studies that consider the existence of a single point of market equilibrium, we consider the existence of a set of equilibrium states. The proposed strategy relies on the division of link capacity into intervals called steps, where current supply is determined according to the expected resource prices, and is the sum of the allocated steps. Consequently, the real state of the market is described by immediately accessible information, such as price.