Internet protocol network design with uncertain demand

This paper is a case study concerning the design and dimensioning of the IP (internet protocol) network of TDC, the largest Danish network operator. Due to historical reasons the number of IP POPs (points of presence) in the network has reached a level, believed to be too high. To point out potential IP POPs for dismantling, we consider a network planning problem concerning dimensioning of the IP POPs and capacity expansion of the transmission links of the network. This problem is formulated as a two-stage stochastic program using a finite number of scenarios to describe the uncertain outcome of future demand. The problem is then solved by an L-shaped algorithm, and we report results of our computational experiments.