A duopoly model with heterogeneous congestion-sensitive customers


Mandjes, M.R.H. and Timmer, J.B. (2003) A duopoly model with heterogeneous congestion-sensitive customers. [Report]

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Abstract:This paper analyzes a model with multiple firms (providers), and two classes of customers. These customers classes are characterized by their attitude towards `congestion' (caused by other customers using the same resources); a firm is selected on the basis of both the prices charged by the firms, and the `congestion levels'. The model can be represented by a two-stage game: in the first providers set their prices, whereas in the second the customers choose the provider (or to not use any service at all) for given prices. We explicitly allow the providers to split their resources, in order to serve more than just one market segment. This enables us to further analyze the Paris metro pricing ({\sc Pmp}) proposal for service differentiation in the Internet.
Item Type:Report
Additional information:Imported from MEMORANDA
Electrical Engineering, Mathematics and Computer Science (EEMCS)
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Link to this item:http://purl.utwente.nl/publications/65865
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