Data offloading in two-tier networks: A contract design approach

Offloading data from cellular networks to WiFi or femtocell networks is an efficient way to alleviate the network congestion caused by rapidly increasing demands for mobile data. To this end, an Internet Service Provider (ISP) is willing to deploy WiFi/femtocell networks. With the advent of such networks, it is necessary to analyze how the ISP sets data plans to improve its profit while mobile data offloading is supported. In this paper, we develop a contract-based scheme to deal with data plan setting problem in two-tier networks. The contract offered by the ISP is a set of data plans which provide different combinations of data volume and price. We classify consumers into different types according to their percentages of data traffic offloaded to WiFi/femtocell networks. Each consumer can choose its own data plan based on its type, which is private information. Under asymmetric information scenario, we provide the necessary and sufficient conditions for the feasibility of a contract and then we derive the optimal contract which maximizes the ISP's profit. Numerical results validate the effectiveness of our scheme and indicate that the ISP can improve its profit by raising the throughput of its WiFi/femtocell networks and/or lowering its energy cost.