Using Modelling and Simulation to Evaluate Network

0 downloads 0 Views 355KB Size Report
Maritime networks thus consists of a Network Operation Centre (NOC) which .... management (PeopleSoft, MIMS, LotusNotes, SAP), email/collaboration (MS ...
7UKPI/QFGNNKPICPF5KOWNCVKQPVQ'XCNWCVG0GVYQTM5GTXKEGUKP/CTKVKOG0GVYQTMU



 :

 7UKPI/QFGNNKPICPF5KOWNCVKQPVQ'XCNWCVG 0GVYQTM5GTXKEGUKP/CTKVKOG0GVYQTMU 

'DYLG.LGVWRQ

&RPPXQLFDWLRQV5HVHDUFK&HQWUH &DQDGD



+PVTQFWEVKQP 

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



/QFGNNKPI5KOWNCVKQPCPF1RVKOK\CVKQP

UREXVWQHVV,QRXUVLPXODWLRQVWKHVHVHUYLFHVZHUHIRXQGWRSURYLGHQHWZRUNDZDUHQHVVDQG VLJQLILFDQWO\LPSURYHWKHWLPHOLQHVVRISULRULWLVHGIORZV 7KLV FKDSWHU FRQWLQXHV ZLWK D GHVFULSWLRQ RI WKH UHVXOWV RI RXU VLPXODWLRQV ZKLFK ZH JDWKHUHG EDVHG RQ D SURFHVV EDVHG RQ ILYH FULWHULD GHYHORSHG WR SURYLGH LPSURYHG FUHGLELOLW\7KHFKDSWHUHQGVZLWKDUHYLHZRIWKHOLPLWHGUHODWHGZRUNLQWKLVDUHDIROORZHG E\DQXPEHURIFRQFOXVLRQVDQGDGLVFXVVLRQRISRVVLEOHIXWXUHZRUNLQWKLVDUHD



/CTKVKOG0GVYQTMU 

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

 )LJ7\SLFDO0DULWLPHQHWZRUN  0DULWLPHQHWZRUNVWKXVFRQVLVWVRID1HWZRUN2SHUDWLRQ&HQWUH 12& ZKLFKDFWVDVDODQG EDVHG UHOD\ IRU DOO VDWHOOLWH FRPPXQLFDWLRQ D OLPLWHG QXPEHU RI PRELOH QRGHV VKLSV RU SRWHQWLDOO\ PDULWLPH ODQGDLU XQLWV  DQG WKH EHDUHUV WKDW FRQQHFW WKHP $ FRPPHUFLDO



7UKPI/QFGNNKPICPF5KOWNCVKQPVQ'XCNWCVG0GVYQTM5GTXKEGUKP/CTKVKOG0GVYQTMU



VDWHOOLWHJURXQGVWDWLRQPD\DOVREHLQFOXGHG7KHIHDWXUHVRIPDULWLPHQHWZRUNVFULWLFDOWR RXUQHWZRUNPRGHODUHH[SDQGHGXSRQLQWKHIROORZLQJVXEVHFWLRQV



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



4QWVKPI%CRCDKNKVKGU 1DYDO PDULWLPH QHWZRUNV DUH QRZ ,3EDVHG $86&$1=8.86   %\ GHIDXOW WKH QHWZRUN WRSRORJ\ LV GULYHQ E\ WKH URXWLQJ SURWRFROV XVHG WR DFKLHYH FRQQHFWLYLW\ HJ 263)  (DFK QHWZRUN LV W\SLFDOO\ GLYLGHG LQWR VHSDUDWH $XWRQRPRXV 6\VWHPV $6  ,Q





/QFGNNKPI5KOWNCVKQPCPF1RVKOK\CVKQP

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

)LJ7UDIILF%UHDNGRZQIRUD1DYDO([HUFLVH 





7UKPI/QFGNNKPICPF5KOWNCVKQPVQ'XCNWCVG0GVYQTM5GTXKEGUKP/CTKVKOG0GVYQTMU



7KLVFKDUWGLYLGHVWKHLQERXQGWUDIILFWRDPDULWLPHQRGHE\DSSOLFDWLRQW\SH,QWHUQHWDQG GHIHQFHEDVHG LQWUDQHW ZHE WUDIILF WRRN XS D VWURQJ PDMRULW\   RI WKH EDQGZLGWK 7KH UHPDLQLQJWUDIILFZDVVSOLWEHWZHHQQHWZRUNRYHUKHDG LHURXWLQJ SHUVRQQHODQGORJLVWLFV PDQDJHPHQW 3HRSOH6RIW 0,06 /RWXV1RWHV 6$3  HPDLOFROODERUDWLRQ 06([FKDQJH 2XWORRN DQGYRLFHFDOOV 92,3 :HZLOOEHXVLQJWKLVPL[LQRXUWUDIILFPRGHOVGHVFULEHG LQ6HFWLRQ  $SSOLFDWLRQ1HWZRUN

0D[ $YJ ESV 3HDN ESV 7\SH LQRXW LQRXW

0&2,1 FRPPDQGDQGFRQWURO 

.

.

2S



92,3

.

.

2S



5693 QHWZRUNRYHUKHDG 

FRQWLQXRXV

.

1HW



263) QHWZRUNRYHUKHDG 

FRQWLQXRXV

.

1HW



,*03 QHWZRUNRYHUKHDG 

FRQWLQXRXV

.

1HW



7)73 VHUYHUWRVHUYHU 

.

.

1HW



06([FKDQJH HPDLO 

.

.

$GP



3ULRULW\

/RWXV1RWHV 'RPLQR5HSOLFDWLRQ 

.

.

$GP



'&20 2XWORRN 

.

.

$GP



6$3 VHUYHUWRVHUYHU 

.

.

$GP



6XSSO\3URJUDP 0,06&)668 

.

.

$GP



3D\6\VWHP &&36 

.

.

$GP



3HUV$GPLQ6\VWHP 3HRSOH6RIW 

.

.

$GP



,QWUDQHW ZHE 

.

.

DGP



3&$Q\ZKHUH 10WRRO 

.

.

1HW



,QWHUQHW ZHE 

.

.

5HF



:LQGRZV0HGLD PXVLFYLGHR 

.

.

5HF



03(*9LGHR UHFUHDWLRQDO 

.

.

5HF



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





/QFGNNKPI5KOWNCVKQPCPF1RVKOK\CVKQP

:KHQPXOWLSOHWUDIILFW\SHVFRQYHUJHRQWRDVLQJOHQHWZRUNWKHUHLVDUHTXLUHPHQWWRHQVXUH WKDWWLPHVHQVLWLYH SULRULWLVHG LQIRUPDWLRQLVGHOLYHUHGEHIRUHOHVVXUJHQWWUDIILF7KHUHIRUH 7( DQG FRPPXQLFDWLRQV PDQDJHPHQW WHFKQLTXHV PXVW EH DSSOLHG WR HQVXUH WKDW WKH SULRULWLHVIRULQIRUPDWLRQGHOLYHU\DUHPHW2XUQHWZRUNVHUYLFHVDUHGHVFULEHGLQ6HFWLRQ



/CTKVKOG0GVYQTM/QFGN 

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



0GVYQTM6QRQNQI[ 7ZR QHWZRUN WRSRORJLHV ZHUH XVHG LQ WKH VLPXODWLRQV 7KH VPDOO QHWZRUN FRQVLVWV RI ILYH QRGHVDQGWKHODUJHQHWZRUNKDVQLQHQRGHVDVVKRZQLQ)LJXUHVDQGUHVSHFWLYHO\  6KLS

NESV/26 NESVVDWHOOLWH NESVVDWHOOLWH

6KLS

6KLS 12&

6KLS

)RXU6KLS0DULWLPH7DVNJURXS

 )LJ6PDOO1HWZRUN  7KH FRQQHFWLYLW\ RI WKH VPDOO QHWZRUN PRGHO VKRZLQJ DOO WKH ZLUHOHVV OLQNV LV VKRZQ LQ )LJXUH7KHOLQNW\SHVDUHDVIROORZV6KLSVKDYHVDWHOOLWHFRPPXQLFDWLRQVWRWKH12& LQGLUHFWO\ YLD VDWHOOLWH  ZLWK VKLS  DQG VKLS  XVLQJ D NESV OLQN ZKLOH VKLS  KDV D NESVOLQN(DFKVKLSDOVRKDVWZRNESVUDGLROLQNVZKLFKIRUPDULQJ7KLVLPSOLHVWKDW 6KLSLVRQO\FRQQHFWHGYLD/26OLQNVIURP6KLSDQG6KLS7KHVPDOOFRQILJXUDWLRQZDV GHVLJQHGEDVHGRQWKHGHVFULSWLRQRIDVLQJOHQDYDOWDVNIRUFH $86&$1=8.86     



7UKPI/QFGNNKPICPF5KOWNCVKQPVQ'XCNWCVG0GVYQTM5GTXKEGUKP/CTKVKOG0GVYQTMU

6KLS



NESV/26

6KLS

NESVVDWHOOLWH NESVVDWHOOLWH

12& 6KLS

6KLS

6KLS

6KLS 6KLS

6KLS

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´EDVHµ SRVLWLRQ DVVKRZQLQ)LJXUH  FDXVLQJOLQNVWRIDLOZKHQWKH\H[FHHG1PDQGUHFRYHU ZKHQWKH\DUHDWPRVW1PDSDUW%DVHGRQWKHQRPLQDOQPKRXUVSHHGRIPDULWLPH QRGHV DQDO\VLV VXJJHVWV WKDW /26 OLQNV LQ WKLV PRGHO KDYH D PHDQ WLPH EHWZHHQ IDLOXUHV 07%) RIDERXWKRXUVDQGDPHDQWLPHWRUHFRYHU\ 0775 RIPLQXWHV1RWHWKDW





/QFGNNKPI5KOWNCVKQPCPF1RVKOK\CVKQP

VLQFHWKH12&LVFRQQHFWHGWRPRELOHQRGHVE\VDWHOOLWHVXFKOLQNVDUHDYDLODEOHDWDOOWLPHV WRWKHQRGHVDWZKLFKVXFKOLQNVDUHRSHUDWLRQDO6LQFHPRGHUQVDWHOOLWHV\VWHPVFDQDFKLHYH 07%)UDWHVRI!KRXUVZLWK0775RIKRXUWKHIDLOXUHRIVDWHOOLWHOLQNVKDVQRW EHHQPRGHOHG  6KLS QP 6KLS

QP 6KLS

QP QP

QP

6KLS

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qWRq 7KHILUVWWDVNJURXSWKHQDSSURDFKHVWKH RWKHUVWHDGLO\DWNQRWV 1PKRXU RQDVHWKHDGLQJHYHQO\GLVWULEXWHGIURPWKLVDQJOH qWRqZLWKqEHLQJGLUHFWO\WRZDUGVWKHFHQWUHRIWKHRWKHUWDVNJURXS,QFRPELQDWLRQ ZLWKLQWUDWDVNJURXSPRELOLW\WKHUHZLOOEHOLQNIDLOXUHVDQGUHFRYHULHVEDVHGRQWKH1P UDQJHRIWKH/26OLQNV7KLVPRELOLW\PRGHOLVRXWOLQHGJUDSKLFDOO\LQ)LJXUH   7DVNJURXS 7UDMHFWRU\

7 $

 QP LQLWLDO GLVWDQFH )LJ,QWHUWDVNJURXSPRELOLW\ 



7DVNJURXS 7$QJOHRIWUDMHFWRU\ $$QJOHRIDUULYDO



7UKPI/QFGNNKPICPF5KOWNCVKQPVQ'XCNWCVG0GVYQTM5GTXKEGUKP/CTKVKOG0GVYQTMU



)RU WKH UHVXOWV GHVFULEHG KHUH D VLQJOH VHW RI DQJOHV ZDV XVHG WR VLPSOLI\ WKH VLPXODWLRQV 7KHDQJOHRIDUULYDOZDVVHWWRqDQGWKHDQJOHRIWUDMHFWRU\ZDVOLNHZLVHVHWWRq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



6TCHHKE/QFGN 7ZRGLIIHUHQWWUDIILFORDGVZHUHGHYHORSHGQRPLQDODQGKHDY\ZLWKWUDIILFGLVWULEXWLRQVDV JLYHQEHORZ7KHUHVXOWLQJEDQGZLGWKEDVH231(7WUDIILFW\SHDQGDSSOLFDWLRQSULRULW\DUH JLYHQLQ7DEOH $SSOLFDWLRQ

$YJEDQGZLGWK NESV QRPLQDO

$YJEDQGZLGWK NESV KLJK

7\SH

3ULRULW\

0FRLQ

LQ RXW

LQ RXW

IWS



9RLFH&DOO

LQ RXW

LQ RXW

* $

 

2YHUKHDG

LQ RXW

LQ RXW

IWS



$GPLQ

LQ RXW

LQ RXW

GDWD EDVH



,QWUDQHW

LQ RXW

LQ RXW

KWWS



(PDLO

LQ RXW

LQ RXW

VPWS



,QWHUQHW

LQ RXW

LQ RXW

KWWS



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





/QFGNNKPI5KOWNCVKQPCPF1RVKOK\CVKQP

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



0GVYQTM5GTXKEG/QFGNU 

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´OHYHOVRIGHWDLOµ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



7UKPI/QFGNNKPICPF5KOWNCVKQPVQ'XCNWCVG0GVYQTM5GTXKEGUKP/CTKVKOG0GVYQTMU



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





/QFGNNKPI5KOWNCVKQPCPF1RVKOK\CVKQP

IRU WKH GHVFULEHG ZHLJKWLQJV WR EH DOORFDWHG FRUUHFWO\ WR WKH OLQN 6LQFH WKH EDQGZLGWK DYDLODEOH RQ WKH OLQN FKDQJHV GHSHQGLQJ RQ HQYLURQPHQWDO FRQGLWLRQV DQG WKH QXPEHU RI RWKHU QRGHV WUDQVPLWWLQJ RQ WKH VDPH IUHTXHQF\ FDOFXODWLQJ WKH RSHUDWLRQDO EDQGZLGWK UHTXLUHV H[WHQVLYH NQRZOHGJH RI WKH FXUUHQW VWDWH RI WKH QHWZRUN 7KH PRGHO XVHG KHUH DVVXPHVDQRPLQDOEDQGZLGWKRINESVRYHUDWZRXVHUNESV/26OLQN



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



4GUQWTEG4GUGTXCVKQP5GTXKEG 7KH556KDVEHHQGHVLJQHGZLWKDQXPEHURIIHDWXUHVWRGHDOZLWKWKHVSHFLILFUHTXLUHPHQWV RI PDULWLPH HQYLURQPHQWV 7KLV LQFOXGHV SURELQJ PXOWLSOH URXWHV LQ SDUDOOHO IRU ORDG EDODQFLQJDQGDQLQFUHDVHGDFFHSWDQFHUDWHDSULRULW\DQGSUHHPSWLRQVFKHPHWRIDYRXUWKH PRVW FULWLFDO IORZV IDXOW WROHUDQFH PHFKDQLVPV WR GHDO ZLWK PRELOLW\ DQG OLQN HUURUV DQG G\QDPLFUHFRQILJXUDWLRQRILWVSDUDPHWHUVWRPHHWFKDQJHVLQRSHUDWLRQDOUHTXLUHPHQWV 7KH 566 FRQVLVWV RI IRXU SKDVHV ,Q WKH ILUVW SKDVH JOREDO OLQN LQIRUPDWLRQ LV XVHG WR JHQHUDWHPXOWLSOHURXWHVEHWZHHQWKHVRXUFHRIWKHUHTXHVWLQJIORZDQGWKHGHVWLQDWLRQ7KH VHFRQG SKDVH RI WKH DOJRULWKP SUREHV WKH SRWHQWLDO URXWHV VHSDUDWHO\ WR GHWHUPLQH LI VXIILFLHQWUHVRXUFHVDUHDYDLODEOH ZKLFKLQFUHDVHVWKHDFFHSWDQFHUDWH ,QWKHWKLUGSKDVHDQ DFFHSWDEOHSDWKLVVHOHFWHGDQGFRPPLWWHG ZKLFKSURPRWHVORDGEDODQFLQJ SRWHQWLDOO\SUH HPSWLQJORZHUSULRULW\IORZV ZKLFKSULRULWLVHVWKHPRVWFULWLFDOIORZV )LQDOO\LQWKHIRXUWK SKDVH WKH UHVHUYDWLRQ LV PDLQWDLQHG XQWLO WKH WUDIILF IORZ LV WHUPLQDWHG E\ WKH XVHU WKH UHVHUYDWLRQOLIHWLPHHQGVWKHUHVHUYDWLRQLVHQGHGPDQXDOO\RUWKHQHWZRUNFDQQRORQJHU VXSSRUW LWV UHTXLUHPHQWV 0RELOLW\ LV KDQGOHG E\ DVVXPLQJ WKH QHWZRUN LV VWDEOH IRU WKH SHULRG RI FDOO VHWXS DQG QHWZRUN PDLQWHQDQFH KDQGOHV WRSRORJ\ FKDQJHV ZKLOH WKH UHVHUYDWLRQLVDFWLYHDVGHVFULEHGEHORZ$GHWDLOHGIXQFWLRQDOGHVFULSWLRQRIWKLVVHUYLFHLV JLYHQLQ .LGVWRQHWDO 



7UKPI/QFGNNKPICPF5KOWNCVKQPVQ'XCNWCVG0GVYQTM5GTXKEGUKP/CTKVKOG0GVYQTMU



4GUGTXCVKQP2TQVQEQN/QFGNU ,QRUGHUWRHYDOXDWHWKHLPSDFWRIWKHVSHFLDOLVHGIHDWXUHVRIWKH556LQPDULWLPHQHWZRUNV RXU VLPXODWLRQV FRPSDUH LW ZLWK ERWK 5693 D VWDQGDUG UHVHUYDWLRQ SURWRFRO IRU IL[HG QHWZRUNV DQG ,16,*1,$ D UHVHUYDWLRQ SURWRFRO SURSRVHG IRU 0$1(7V 7KHUH DUH VLJQLILFDQW GLIIHUHQFHV LQ WKH RSHUDWLRQ RI WKH WKUHH UHVHUYDWLRQ SURWRFROV VLPXODWHG 7KH ODUJHVW GLIIHUHQFH LV WKDW 556 LQFOXGHV PXOWLURXWLQJ DQG SUHHPSWLRQ ,Q 556 HDFK UHVHUYDWLRQ LV PDGH ZLWK XS WR  SDUDOOHO SUREHV WR H[HUFLVH WKH SDUWLDOO\ GLVMRLQW PXOWL URXWLQJDVSHFWRIWKHSURWRFRO7KHSULRULW\PHFKDQLVPRIWKHVHUYLFHZDVDOVRH[HUFLVHGE\ DVVLJQLQJ HDFK QHZ UHVHUYDWLRQ RQH RI WKUHH SULRULW\ OHYHOV ORZ PHGLXP DQG KLJK  ZLWK HTXDO SUREDELOLW\ 5HTXHVWV RI ORZHU SULRULW\ PD\ EH SUHHPSWHG GURSSHG  LQ RUGHU WR DGPLW D KLJKHUSULRULW\ IORZ +LJKSULRULW\ IORZV DUH QRW SUHHPSWHG DQG PD\ RQO\ EH EORFNHG IURP EHLQJ DFFHSWHG E\ RWKHU KLJK SULRULW\ IORZV 3UHHPSWHG IORZV DUH FDOOHG DGPLWWHG WKH\ ZHUH LQLWLDOO\ DFFHSWHG  EXW XQVXFFHVVIXO WKH\ WHUPLQDWHG EHIRUH WKHLU VFKHGXOHG HQG WLPH  ,I D UHTXHVW LV QRW LQLWLDOO\ DGPLWWHG LW LV DOVR XQVXFFHVVIXO 1R DGGLWLRQDODWWHPSWVDUHPDGHWRHVWDEOLVKDUHVHUYDWLRQ ,Q RUGHU WR LPSOHPHQW WKH 556 VRPH 231(7 PRGHOV KDG WR EH PRGLILHG DQG QHZ RQHV FUHDWHG 2XU DSSURDFK ZDV WR XVH WKH H[LVWLQJ ,3 QHWZRUNLQJ PRGHOV DQG VLPSO\ DGG 556 SDFNHWSURFHVVLQJFDSDELOLW\RQWRSVR556PHVVDJHVFRXOGEHSURFHVVHGDQGIRUZDUGHGDV UHTXLUHG)LUVWDVLJQLILFDQWFKDQJHZDVUHTXLUHGWRWKH263)PRGHOLQWKHVKLS·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



4GUGTXCVKQP4GSWGUV/QFGNU ,QRUGHUWRDVVHVVWKHRSHUDWLRQRIWKHUHVHUYDWLRQSURWRFROVWZRYDULDEOHVZHUHLQYHVWLJDWHG )LUVW WKH LPSDFW RI WKH VRXUFH RI UHTXHVWV ZDV LQYHVWLJDWHG ZLWK WZR GLIIHUHQW PRGHOV 6HFRQG LQ RUGHU WR GHWHUPLQH WKH HIIHFW RI QHWZRUN ORDGLQJ WZR QHWZRUN UHVHUYDWLRQ UHTXHVWDUULYDOUDWHVZHUHFKRVHQ )RUDOOSURWRFROVWKHWRWDOWLPHDUHVHUYDWLRQUHPDLQHGDFWLYHZDVEDVHGRQDQH[SRQHQWLDO GLVWULEXWLRQZLWKPHDQRIVHFRQGV5HVHUYDWLRQVDUHIRUNESVZLWKDPD[LPXPRI RI HDFK OLQN·V EDQGZLGWK DYDLODEOH IRU UHVHUYDWLRQV 7KHVH YDOXHV ZHUH FKRVHQ WR VLPXODWH YRLFHFRQQHFWLRQV





/QFGNNKPI5KOWNCVKQPCPF1RVKOK\CVKQP

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



4GUWNVU 

/GVJQFQNQI[ %TGFKDKNKV[  :LUHOHVV QHWZRUN VLPXODWLRQV UHVHDUFK KDV FRPH XQGHU LQFUHDVLQJ VFUXWLQ\ RI ODWH 5HFHQW SXEOLFDWLRQV KDYH UDLVHG TXHVWLRQV DERXW WKH FUHGLELOLW\ RI SDVW VLPXODWLRQ ZRUN DQG KDYH VXJJHVWHG GLIIHUHQW PHWKRGV E\ ZKLFK WKLV FDQ EH UHVROYHG )RU H[DPSOH LQ $QGHO