CDN Pricing and Investment Strategies under Competition

A content delivery network (CDN) is a large distributed system that caches content at multiple locations on the Internet. This chapter focuses on CDN pricing and introduces a game‐theoretic model to analyze the price competition among CDNs. It describes sufficient conditions for price wars in a two‐CDN pricing game. The chapter also focuses on CDNs' investment strategies and formulates a dynamic CDN game where the market structure, for example, the number of CDNs and their corresponding coverage, can be changed. It first analyzes market changes caused by CDN federation and provide the conditions for small CDNs to benefit from a CDN federation. The chapter provides content producers' CDN selection problem.