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Real-time delay announcement under competition

Singh, SP; Delasay, M; Scheller-Wolf, A; (2022) Real-time delay announcement under competition. Production and Operations Management 10.1111/poms.13903. (In press). Green open access

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Internet-based technology enables firms to disseminate real-time delay information to delay-sensitive customers. We study how such delay announcements impact service providers in a competitive environment with two service providers who compete for market share. We model the service providers' strategies based on an endogenous timing game, investigating strategies that emerge in equilibrium. We determine the service providers' market shares under the various game outcomes by analyzing continuous-time Markov chains, which capture customers' joining decisions, and by developing a novel computational technique to analyze the intractable asymmetric Join-the-Shortest Queue system, providing bounds on the market shares. We find that only the lower capacity service provider announces its real-time delay under intermediate system loads and highly imbalanced capacities. However, for most parameter settings, the mere presence of a competitor induces both providers to announce delays in equilibrium, leaving customers better off on average. We relate our findings to the single-provider delay announcement literature by discussing the impact of competition on service providers, delay announcement technology firms, and customers.

Type: Article
Title: Real-time delay announcement under competition
Open access status: An open access version is available from UCL Discovery
DOI: 10.1111/poms.13903
Publisher version: https://doi.org/10.1111/poms.13903
Language: English
Additional information: © 2022 The Authors. Production and Operations Management published by Wiley Periodicals LLC on behalf of Production and Operations Management Society. This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.
Keywords: delay announcement, endogenous timing game, Markov chain, service systems
UCL classification: UCL
UCL > Provost and Vice Provost Offices > UCL BEAMS
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science > UCL School of Management
URI: https://discovery.ucl.ac.uk/id/eprint/10161473
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