With cellular phones mass-market consumer items, the next frontier is mobil
e multimedia communications. This situation raises the question of how to d
o power control for information sources other than voice. To explore this i
ssue, we use the concepts and mathematics of microeconomics and game theory
. In this context, the qualify of service of a telephone call is referred t
o as the "utility" and the distributed power control problem for a CDMA tel
ephone is a "noncooperative game." The power control algorithm corresponds
to a strategy that has a locally optimum operating point referred to as a "
Nash equilibrium." The telephone power control algorithm is also "Pareto ef
ficient," in the terminology of game theory. When we apply the same approac
h to power control in wireless data transmissions, we find that the corresp
onding strategy, while locally optimum, is not Pareto efficient. Relative t
o the telephone algorithm, there are other algorithms that produce higher u
tility for at least one terminal, without decreasing the utility for any ot
her terminal. This article presents one such algorithm. The algorithm inclu
des a price function proportional to transmitter power. When terminals adju
st their power levels to maximize the net utility (utility - price), they a
rrive at lower power levels and higher utility than they achieve when they
individually strive to maximize utility.