New modeling approaches for the design of local access transport area networks

This paper is concerned with the design of a local access and transport area network that arises in the context of providing a special access service by a local exchange facility. The problem includes locating suitable hub facilities having adequate multiplexing capacity, and routing the demand traffic from various clients (end offices) through their hubs, or alternatively, through a special point of presence node, in order to minimize total costs. These costs involve various traffic distribution and equipment component costs, where the latter typically exhibit nonlinear economies of scale. We develop a model for this problem and apply the reformulation–linearization technique to construct various enhanced tightened versions of the proposed model. We also design a hybrid heuristic procedure that combines a limited run of an exact method with a Lagrangian dual/relaxation procedure. Extensive computational results are provided to study the relative tightness resulting from the various formulations and their effect on providing good quality feasible solutions.