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| Research on Monitoring Quality and Pricing Decisions of Remote Diagnostic Services for Products |
| SUN Mingyao，CHAI Qiangfei，WU Feng |
| 1. Capital University of Economics and Business, Beijing, China; 2. Nanjing University of Posts and Telecommunications, Nanjing, China; 3. Xi’an Jiaotong University, Xi’an, China |
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Abstract Results of remote diagnosis are always imperfect because of the data quality problem. Improving the monitoring quality can improve the diagnostic accuracy, but at the same time will increase the investment cost. Thus, service providers need to weigh these two decisions. This study develops a strategic queuing model to study the service provider’s optimal monitoring quality and service price decisions. In addition, the effect of diagnostic time on the equilibrium is investigated. The results show that if the monitoring quality and diagnostic time are independent, there exists a maximum value point that maximizes the service provider’s profit and the optimal monitoring quality and diagnostic time are complementary. However, if the monitoring quality and diagnostic time are correlated, the service provider’s profit increases with the monitoring quality. We also show that the users’ join-or-balk strategy depends on not only the service provider’s decisions, but also the demand potential.
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Received: 18 July 2022
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