Cost modelling and validation in network optimization

Addie, Ronald G. and Peng, Yu and Albdair, Mostfa and Xing, Chang and Fatseas, David and Zukerman, Moshe (2015) Cost modelling and validation in network optimization. In: 25th International Telecommunication Networks and Applications Conference (ITNAC 2015), 18-20 Nov 2015, Sydney, Australia.


There are many costs associated with the build- ing and running a telecommunications network, both capital (CAPEX) and operational (OPEX) costs. On the one hand, complex routing schemes activated in multi-layer networks, like MPLS, logically imply assignment of costs to a collection of
modules, from more than one layer, so defining the cost model is a non-trivial task. On the other hand, optimization methods based on prices for sending packets via different paths, which include methods using shortest path as a design principle, require a cost model to be precise, in order to achieve a correct solution. A well-defined cost model enables us to analyze and check costs for each layer and for each subsystem within a layer, and provides a step-by-step procedure for validation of prices. To guarantee the correctness of the defined cost model, we produce a well-structured report which confirms the validity of prices and of the total cost. The criteria of the validation of the cost model is that the total cost of the network when calculated from the prices to be attributed to the traffic is equal to the total network cost (CAPEX + OPEX) less any discounts. This validation process is similar to double-entry bookkeeping which is common in the business world and which enables detection of errors in accounting systems. It is shown that the requirement for validation justifies pricing based
optimization. We provide examples where the application of this concept in a multi-layer network design software tool ensures that optimization works correctly, and one example where prices are not valid and the optimization fails.

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Item Type: Conference or Workshop Item (Commonwealth Reporting Category E) (Paper)
Refereed: Yes
Item Status: Live Archive
Additional Information: Permanent restricted access to Published version, in accordance with the copyright policy of the publisher.
Faculty / Department / School: Current - Faculty of Health, Engineering and Sciences - School of Agricultural, Computational and Environmental Sciences
Date Deposited: 30 Jun 2016 05:46
Last Modified: 04 Oct 2017 01:25
Uncontrolled Keywords:
Fields of Research : 08 Information and Computing Sciences > 0804 Data Format > 080403 Data Structures
Socio-Economic Objective: B Economic Development > 89 Information and Communication Services > 8901 Communication Networks and Services > 890101 Fixed Line Data Networks and Services
Identification Number or DOI: 10.1109/ATNAC.2015.7366782

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