The Optimality of Two Prices: Maximizing Revenue in a Stochastic Network

This paper considers the problem of pricing and transmission scheduling for an Access Point (AP) in a wireless network, where the AP provides service to a set of mobile users. The goal of the AP is to maximize its own time-average profit. The authors first obtain the optimum time-average profit of the AP and prove the "Optimality of Two Prices" theorem. Then they develop an online scheme that jointly solves the pricing and transmission scheduling problem in a dynamic environment. The scheme uses an admission price and a business decision as tools to regulate the incoming traffic and to maximize revenue.