Auction Models Supporting End-to-End Connection Trading

Abstract

The paper concerns bandwidth allocation problem on the telecommunication market where there are many sellers and buyers. Sellers offer the bandwidth of telecommunication links. Buyers are interested in the purchase of the bandwidth of several links that makes up an end-to-end connection between two nodes of telecommunication network. We analyze three auction models supporting such a bandwidth exchange: NSP (network second price), BCBT (model for balancing communication bandwidth trading) and BCBT-CG which is a modification of BCBT that applies column generation technique. All of these models concern divisible network resources, treat bandwidth of telecommunication links as an elementary commodity offered for sale, and allow for purchasing bandwidth along multiple paths joining two telecommunication nodes. All of them also aim at maximizing the social welfare. Considered auction models have been compared in the respect of economic and computational efficiency. Experimental studies have been performed on several test instances based on the SNDlib library data sets.