Top-percentile traffic routing problem by dynamic programming

Multi-homing is a technology used by Internet Service Provider (ISP) to connect to the Internet via different network providers. To make full use of the underlying networks with minimum cost, an optimal routing strategy is required by ISPs. This study investigates the optimal routing strategy in case where network providers charge ISPs according to top-percentile pricing. We call this problem the Top-percentile Traffic Routing Problem (TpTRP). The TpTRP is a multistage stochastic optimisation problem in which routing decision should be made before knowing the amount of traffic that is to be routed in the following time period. The stochastic nature of the problem forms the critical difficulty of this study.