Economics of Fog Computing: Interplay Among Infrastructure and Service Providers, Users, and Edge Resource Owners

Fog computing is a paradigm which brings computing, storage, and networking closer to end users and end devices for better service provisioning. One of the crucial factors in the success of fog computing is on how to incentivize the individual users’ edge resources and provide them to end users such that fog computing is economically beneficial to all involved economic players. In this paper, we model and analyze a market of fog computing, from which we aim at drawing practical implications to uncover how the fog computing market should operate. To this end, we conduct an economic analysis of such user-oriented fog computing by modeling a market consisting of Infrastructure and Service Provider (ISP), end Service Users (SUs), and Edge Resource Owners (EROs) as a non-cooperative game. In this market, ISP, which provides a platform for fog computing, behaves as a mediator or a broker which leases EROs’ edge resources and provides various services to SUs. In our model, a two-stage dynamic game is used where in each stage, there exists a dynamic game, one for between ISP and EROs and another for between ISP and SUs, to model the market more practically. Despite this complex game structure, we provide a closed-form equilibrium analysis which gives an insight on how much economic benefit is obtained by ISP, SUs, and EROs from user-oriented fog computing under what conditions, and we figure out the economic factors that have a significant impact on the success of fog computing.