Background: Elastic optical networks can support high data bit rates efficiently with its flexible wavelength grid, and with virtual optical networks, network resources can be managed simply. However, the signal may be deteriorated by the physical impairments. Therefore, service differentiation techniques have to consider the physical impairments.
Objective: We propose a novel virtual optical network construction algorithm that provides service differentiation. Moreover, the effect of physical impairments is considered before constructing a virtual optical network. The goal of the proposed algorithm is to provide service differentiation in terms of the rejection rate of virtual optical network requests. Here, we consider the on-line scenario where the traffic is not known in advance. Methods: In the proposed method, each virtual optical network comprises two nodes and a lightpath between the two nodes. In our proposed method, service differentiation is provided by giving a higher (lower) acceptance rate for high (low) priority users. This method consists of four mechanisms; signaling mechanism, physical impairment estimation mechanism, resource check mechanism, and retransmission mechanism. Numerical Results: We evaluate by simulation the performance of the proposed method in NSFNET and European topologies. Analysis of the rejection rate as function of network load, impact of the network load on the number of retransmissions, and impact of network topology were discussed. Numerical results show that our method not only provides service differentiation but also reduces the overall rejection rate. Conclusion: We can conclude that our method is efficient compared to the conventional methods considering the scenario and topologies analyzed.Keywords: Elastic optical networks, lightpath, network virtualization, physical impairments, service differentiation, virtual network embedding, virtual optical networks.