Patent ID: 7080031

Claim:
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; wherein the revenue expression is: TotalRevenue = n ⁢ ∑ T = 1 T last ⁢ d T ⁢ ( ∑ p = 1 P ⁢ γ ⁢ ( Revenue pT CurrentDemand + Revenue pT NewDemand ) ) wherein Revenue pT CurrentDemand =α(Price pT−1 +Price pT )Demand pT−1 , Revenue pT NewDemand =β(Demand pT −Demand pT−1 )Price pT , where α and β are sealing factors, Price pT ⁢ ( Demand pT ) = ( β pT ⁢ A pT Demand pT ) 1 / η pT , where β pT is a share growth parameter, A pT = ( Price pT ⁢ Demand pT ) , and ⁢ ⁢ η = - Δ ⁢ ⁢ Q Q Δ ⁢ ⁢ P P , ⁢ where ⁢ ⁢ P ⁢ ⁢ is ⁢ ⁢ price ⁢ ⁢ and ⁢ ⁢ Q ⁢ ⁢ is ⁢ ⁢ demand . (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.