System and method for determining an evolving combination of network components to maximize the net present value of a provider's cash flow
First Claim
1. A method of maximizing a net present value (NPV) of a cash flow that results from provision of communication services between nodes of a network, wherein maximization is achieved through selection of an appropriate combination of network components and product prices over a plurality of consecutive time periods, the method comprising the steps of:
- (a) receiving constraint information regarding demand for products, prices of products, network topology, available technology, costs, and an initial state of the network;
(b) forming an expression that models revenue received as a result of sales of products at each time period T, wherein the revenue expression is a function of price and demand for each product p at each time period T;
(c) determining traffic capacity for each link at each time period T;
(d) forming an expression that models costs of providing communications services, wherein the cost expression is a function of demand for each product p at each time period T and of the number of rings and wavelengths bought, used, and retired, for each technology, circle, and time period T;
(e) forming an expression that models NPV as an objective function of revenue and costs; and
(f) optimizing the objective function.
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Accused Products
Abstract
A method and computer program product are presented for selecting and arranging an appropriate combination of network components, or elements, in a communications network. The selection of network components is done in a manner that maximizes the net present value of cash flow resulting from the provision of communications services between nodes of the network. The method comprises the steps of receiving information that constrains network design and price establishment, and then using the constraint information to select a combination of network components for each link in the communications network. According to the invention, the selection of network components is performed for each of several successive time periods, effectively planning the evolution of the network. The selections are made so that the network components satisfy demand over time while maximizing the net present value of the cash flow that results from the provision of communications services.
18 Citations
20 Claims
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1. A method of maximizing a net present value (NPV) of a cash flow that results from provision of communication services between nodes of a network, wherein maximization is achieved through selection of an appropriate combination of network components and product prices over a plurality of consecutive time periods, the method comprising the steps of:
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(a) receiving constraint information regarding demand for products, prices of products, network topology, available technology, costs, and an initial state of the network;
(b) forming an expression that models revenue received as a result of sales of products at each time period T, wherein the revenue expression is a function of price and demand for each product p at each time period T;
(c) determining traffic capacity for each link at each time period T;
(d) forming an expression that models costs of providing communications services, wherein the cost expression is a function of demand for each product p at each time period T and of the number of rings and wavelengths bought, used, and retired, for each technology, circle, and time period T;
(e) forming an expression that models NPV as an objective function of revenue and costs; and
(f) optimizing the objective function. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 9, 10, 11)
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12. A method for modeling a communications network over which communication products may be offered, wherein the method comprises:
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(a) receiving constraint information that comprises a demand for the communication products, an initial state of the communications network, offering prices for the communications products and costs for components of the communications network;
(b) using the constraint information to form a revenue expression that models revenue received as a result of sales of the communication products during a plurality of time periods, wherein the revenue expression is a function of price and demand for the communication products at each time period;
(c) using the constraint information to form a cost expression that models costs of providing the communication products during the plurality of time periods, wherein the cost expression is a function of demand for the communication products at each time period and cost of maintaining the communications network at each time period;
(d) relating the revenue expression to the cost expression to yield an objective function;
(e) optimizing the objective function; and
(f) using the optimized objective function to determine appropriate components for the communications network and to determine appropriate offering prices for the communications products. - View Dependent Claims (13, 14, 15, 16, 17, 18)
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19. A method for modeling a communications network over which communication products may be offered, wherein the method comprises:
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(a) receiving constraint information that comprises a demand for the communication products, an initial state of the communications network, information regarding an initial state of the communications network, offering prices for the communications products and costs for components of the communications network, wherein the information regarding the initial state of the communications network comprises network topology information representing an initial set of network nodes each connected to at least one other network node by a link;
(b) using the constraint information to form a revenue expression that models revenue received as a result of sales of the communication products during a plurality of time periods, wherein the revenue expression is a function of price and demand for the communication products at each time period;
(c) determining traffic capacity for each link at each time period;
(d) using the constraint information to form a cost expression that models costs of providing the communication products during the plurality of time periods, wherein the cost expression is a function of demand for the communication products at each time period and cost of maintaining the communications network at each time period;
(e) relating the revenue expression to the cost expression to yield an objective function;
(f) optimizing the objective function; and
(g) using the optimized objective function and the determined traffic capacity for each link to determine appropriate components for the communications network and to determine appropriate offering prices for the communications products. - View Dependent Claims (20)
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Specification