Sensor Service Selection through Switch Options

Abstract

Abstract-Service-oriented Architecture (SOA) for sensor network applications aims at providing composable sensor network services supporting functionality within a specific application domain together with tools for service composition, so more complex functionalities can be composed of component services. In a distributed environment, such a scheme works by having a given component service choose other components that provide the data that it needs to perform its service. In this paper, we propose to use real options theory for selecting component services. Real options are designed to reduce the risk associated with an investment by delaying the investment decision for a certain period of time or by allowing for the substitutions of initial investment. Thus, they enhance managerial flexibility and add to the overall value of a project but at the same time they incur certain costs. It is natural to think about activated services as investments, and we apply the switch options subset of the real options methodology to manage the risks of high cost that may result from the low reliability of sensors and sensor networks. Furthermore, we compare our approach with several service selection methods and show the advantage of the option-based methodology.

Data Collection and Wireless Communication in Internet of Things (IoT) Using Economic Analysis and Pricing Models: A Survey

“…Switch option (see Chapter 10 in [251] for more details) is a special type of the real options which has been widely used in economics to select the mode of production for factories or switching between investment options to maximize the profit or to minimize loss. The authors in [252] adopted the switch option model to maximize the VoI in a parking garage monitoring network. The system consists of two services: a microphone service of reading from an acoustic sensor to monitor the sound volume and a camera service that provides views of the area covered by the microphone monitors.…”