A Mobile Network Operator's Decision for Partnership with Zero-Rating Internet Platforms

Zero-rating is the concept of not counting data usage of end-users for accessing the basic functions of some websites via mobile network operators (MNOs). Recently, some zero-rating platforms (e.g. Internet.org) are formed allowing the websites present their contents as zero-rated. In current setup of zero-rating platforms, no monetary reward is transferred to partner MNOs. Therefore, MNOs face a question of whether to cooperate with zero-rating platforms or not. In this paper, a variant of Stackelberg game is used to model the interaction between an MNO and its end-users toward providing their access to zero-rating services (i.e. partnership of the MNO and zero-rating platforms). We propose a bundle pricing scheme for the MNO and study the effects of including zero-rating services in the bundles. The proposed model assists the MNO to make decision on including zero-rating services in its bundles as well as appropriate pricing scheme. Numerical studies show that depending on the end- users' preferences, the MNO may increase its profit by including zero-rating services in its bundles.