Selective Free Data Access to Cellular Networks

We investigate a cooperation scenario in which a cellular service provider (CSP) agrees to offer free Internet access to a certain number of applications offered by a governmental entity, referred to as a non-profit service provider (NSP). NSP also provides a WiFi Internet network via which its applications can be accessed free of charge but the network budget for the network expansion and making the access available to all potential users is limited. To overcome this issue, NSP aims to provide a part of its applications also available through a commercial cellular network. Thus, the main problem of NSP is finding the optimal portion of its budget that should be transferred to CSP as a side-payment for its service. To address this problem we propose a game that is modeling a multi-period contract between CSP and NSP. Since the coverage of NSP's free network affects the price of the CSP service, we solve a three stage Stackelberg game in which each network entity finds its best response. The outcome of our game is the optimally assigned NSP budget for the free cellular data access, the size of free cellular data volume, and the optimal service price of CSP in each period. We provide numerical examples in which we show the effect of the NSP budget and the number of subscribers on the optimal values.