Abstract
Mobile phones are among the most popular consumer devices and the recent developments of 3G networks and smart phones enable users to watch video programs by subscribing data plans from service providers. Due to the ubiquity of mobile phones and phone-to-phone communication technologies, subscribers can redistribute the video content to non-subscribers. Such a redistribution mechanism is a potential competitor for the service provider and is very difficult to trace given the users'' high mobility. The service provider has to set a reasonable price for the data plan to prevent such re-distribution behavior to protect his/her own profit. In this paper, we analyze the optimal price setting for the service provider by investigating the equilibrium between the subscribers and the secondary buyers in the content-redistribution network. We model the behavior between the subscribers and the secondary buyers as a hybrid Stackelburg auction game and find the optimal price and quantity for both groups of users. Such an analysis can help the service provider preserve their profit under the threat of the redistribution networks and can improve the quality of service for end users.
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