This paper presents an online sponsored search auction that
motivates advertisers to report their true budget, arrival time,
departure time, and value per click. The auction is based on a
modified \emph{Multi-Armed Bandit (MAB)} mechanism that allows for
advertisers who arrive and depart in an online fashion, have a value
per click, and are budget constrained.
In tackling the problem of truthful budget, arrival and departure
times, it turns out that it is not possible to achieve truthfulness
in the classical sense (which we show in a companion paper). As
such, we define a new concept called \emph{$\delta$-gain}.
$\delta$-gain bounds the utility a player can gain by lying as
opposed to his utility when telling the truth. Building on the
$\delta$-gain concept we define another new concept called
\emph{relative $\epsilon$-gain}, which bounds the relative ratio of
the gain a player can achieve by lying with respect to his true
utility. We argue that for many practical applications if the
$\delta$-gain and or the relative $\epsilon$-gain are small, then
players will not invest time and effort in making strategic choices
but will truthtell as a default strategy. These concepts capture the
essence of dominant strategy mechanisms as they lead the advertiser
to choose truthtelling over other strategies.
In order to achieve $\delta$-gain truthful mechanism this paper also
presents a new payment scheme, Time series Truthful Payment Scheme
(TTPS), for an online budget-constrained auction mechanism. The
payment scheme is a generalization of the VCG principles for an
online scheduling environment with budgeted players.
Using the concepts of $\delta$-gain truthful we present the only
known budget-constrained sponsored search auction with truthful
guarantees on budget, arrivals, departures, and valuations. Previous
works that deal with advertiser budgets only deal with the
non-strategic case.