Revenue sharing in edge-cloud systems: A Game-theoretic perspective

Abstract

We explore the design of revenue sharing mechanisms for an Edge-Cloud computing system from a game-theoretic perspective. Different from traditional cloud computing, the providers in an Edge-Cloud system are independent and self-interested. The system adopts a task distribution mechanism to maximize the total revenue received from clients and employs a revenue sharing mechanism to split the received revenue among service providers. Under system-level mechanisms, service providers game with the system in order to maximize their own utilities by strategically allocating their resources. We introduce a game-theoretic framework to model the competition among the service providers as a non-cooperative game. We show the existence of Nash equilibrium in the game theoretically and experimentally. We find that at Nash equilibria, the revenue sharing design based directly on actual contributions of service providers results in significantly worse system-level performance than revenue sharing mechanisms based on marginal contributions. We find that the reason for this seemingly counter-intuitive result is that revenue sharing mechanisms based on marginal contributions discourage providers with less powerful resources from contributing resources to the system at equilibrium state. Our framework offers an economics approach to the understanding of Edge-Cloud systems and provides fundamental insights into their revenue sharing design.