An Algorithm To Facilitate Uber-Style Dynamic Phone Tariffs (thestack.com)

An anonymous reader writes: A new paper proposes an algorithm to help network providers furnish 'surge' pricing for mobile data and other network communications, citing a 50% shortfall between demand and capacity over the next five years as an indicator that consumers may have to be shepherded out of the congested times and areas in order for normal service to continue to be maintained. Just don't tell any of the people in charge of airport wireless networks.

Comments

Disaster "surges"

[BenJeremy]

Great, let's charge people 5000% of their rates when something terrible hits, like a terrorist attack or some sort of natural disaster, and penalize people for letting people know they are alright or trying to track down their loved ones to make sure they survived!

Re:Disaster "surges"

[Dagger2]

In theory. In practice, the result is that the provider is strongly encouraged to under-provision their network so they can charge extreme rates for normal use, citing "high" utilization as an excuse. So you end up with a poor experience at all times, rather than just during disasters.

It'd work well if we had some kind of requirement in place that mandated capacity upgrades such that the system only approaches max capacity less than x% of the time, where x is small. But that's not going to happen.

Re:Disaster "surges"

[Ichijo]

In practice, the result is that the provider is strongly encouraged to under-provision their network so they can charge extreme rates for normal use, citing "high" utilization as an excuse.

Is it still surge pricing if the surge price is charged all the time?

It's a Duopoly

[ElitistWhiner]

It's called herding. Like cattle to slaughter. When you own the processing plant and control the market price - it's a duopoly data-feedloting.

Amazon Model

[Luthair]

Maybe it would be better if they followed the Amazon model where they built the infrastructure to support the surges and turned the excess into a viable business instead of mimicking a glorified bandit taxi dispatcher that has never been profitable.

Reward networks for not upgrading

[nitehawk214]

They get paid more the worse their network is. Yeah, great idea, I am sure customers will love this.

What will the market bear?

[ljhiller]

Last year Uber quadrupled their prices for people trying to leave downtown Sydney during a hostage standoff. Uber style phone tariffs means that if terrorists kill 100-1000 people in a town, it will cost $50 for people to communicate their survival to concerned family members, because after all, that's what people will pay, right? So it's all good.

Re:What will the market bear?

[phizi0n]

At face value quadrupled prices seems bad but it incentivized drivers to pick up people, putting their own lives at risk in the process, rather than just leaving everyone stranded there. It may have even enticed some drivers to head towards the danger rather than staying comfortably away. Depending on local laws they sometimes have to cap the surge pricing in disaster/emergency situations so if you don't like the idea inflated prices during these events then perhaps you should try to get your laws changed.

IMO surge pricing for cell networks would be fine as long as there were a small buffer before the surge pricing kicked in and that it notify you beforehand. Say it's a 1MB grace allotment, you could upload one picture, talk for a couple mins, or send hundreds of text messages. That last option is key, if you really need to communicate information then texting is the most efficient way to do it.

Re:Time-based phone rates?

[Zero__Kelvin]

"I bet that if you graphed out the busiest times for cell phone networks, they'd match pretty close to AT&T's old time-based schedule?

Why? Because AT&T wasn't stupid, and didn't just pull shit like this out of their arses."

When rates varied at different times of the day teenagers didn't have cell phones. Things have changed drastically since those days. In fact, they often had very restricted access to the house phone since many people didn't have call waiting and when one was on the phone nobody could call in to the house.

will not work

[enrevanche]

This would be a nightmare for users. When finding a ride using Uber, it is easy to decide if you accept the price. With phone/data surge pricing you will have to constantly check the rate every time you use the phone for something. The first provider that tries this will no longer have any capacity issues, not because the algorithm solves the problem directly, but because there will be a mass exodus of customers.

Re:sort of makes sense

[CrimsonAvenger]

Since uber is not like a traditional cab company with a fixed number of drivers, they can easily increase supply of drivers during high demand times to ensure proper supply.

Okay, I'll bite. HOW can Uber "easily increase supply of drivers during high demand"?

I'm going to have to assume you think that Uber has the legal authority to require, for instance, that I (or you, for that matter) work for them during high demand times, whether you want to or not. Alas, that's not the case. Uber can't require me to work for them at all, much less during high demand times.