Abstract
One of the main aims of telecommunication subsidies
in developing countries is to extend the information and
communication services to the information “have nots” through
subsidized communication services. However, subsidies may have
an impact on network resource utilization, quality of service and
the amount of revenue generated. For example, subsidies may
lead to low Quality of Service (QoS) and high resource utilization
while in some instances unsubsidized services may lead to high
quality of services and low utilization of resources. This see-saw
effect may eventually lead to market failure and it may, now
and then, destroy market efficiency. This phenomenon calls for a
combined study, in which the relationship between subsidy, price,
QoS and resource utilization is investigated. In this paper, the
impact of subsidies on quality of service and resource utilization
in multitier communities is investigated. We try to find a middle
ground between implementation of subsidy policy and its effects
on QoS and resource utilization in a network.