This paper investigates the dynamical behaviors of a duopoly model with two content providers (CPs). Competition between two CPs is assumed to take place in terms of their pricing decisions and the credibility of content they offer. According to the CPs’ rationality level, we consider a scenario where both CPs are bounded rational. Each CP in any period uses the marginal profit observed from the previous period to choose its strategies. We compute explicitly the steady states of the dynamical system induced by bounded rationality, and establish a necessary and sufficient condition for stability of its Nash equilibrium (NE). Numerical simulations show that if some parameters of the model are varied, the stability of the NE point is lost and the complex (periodic or chaotic) behavior occurs. The chaotic behavior of the system is stabilized on the NE point by applying control.
In internet market, content providers (CPs) continue to play a primordial role in the process of accessing different types of data. Competition in this area is fierce; customers are looking for providers that offer them good content (credibility of content and quality of service) with a reasonable price. In this work, the authors analyze this competition between CPs and the economic influence of their strategies on the market. The authors formulate their problem as a non-cooperative game among multiple CPs for the same market. Through a detailed analysis, the researchers prove uniqueness of a pure Nash Equilibrium (NE). Furthermore, a fully distributed algorithm to converge on the NE point is presented. In order to quantify how efficient the NE point is, a detailed analysis of the Price of Anarchy (PoA) is adopted to ensure the performance of the system at equilibrium. Finally, an extensive numerical study is provided to describe the interactions between CPs and to point out the importance of quality of service (QoS) and credibility of content in the market.
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