Price and Inventory Competition in Oligopoly TV White Space Markets

Abstract

In this paper, we investigate an oligopoly-competitive TV white space (TVWS) market, where multiple secondary network operators compete to serve a common pool of secondary end users by using TVWS purchased from a white space database. We first study the competitive interactions among secondary operators. Specifically, we formulate the interactions as a noncooperative price-inventory competition game, where operators determine the spectrum inventory (purchased from the database) and the service price (charged to end users) simultaneously. We prove the existence and uniqueness of the Nash equilibrium using the supermodular game theory. Then, we study the impact of the database manager's wholesale pricing strategy on the market equilibrium. Specifically, we analytically show how the wholesale prices affect the operators' equilibrium inventory and pricing decisions. Based on this analysis, we further propose two different spectrum wholesale pricing strategies that maximize the database manager's profit and the total network profit, respectively. Our simulations evaluate the performance difference between these two wholesale pricing strategies.