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Cloud-based computing technology is one of the most significant technical advents of the last decade and extension of this facility towards access networks by aggregation of cloudlets is a step further. To fulfill the ravenous demand for computational resources entangled with the stringent latency requirements of computationally-heavy applications related to augmented reality, cognitive assistance and context-aware computation, installation of cloudlets near the access segment is a very promising solution because of its support for wide geographical network distribution, low latency, mobility and heterogeneity. In this paper, we propose a novel framework, Cloudlet Cost OptiMization over PASSIve Optical Network (CCOMPASSION), and formulate a nonlinear mixed-integer program to identify optimal cloudlet placement locations such that installation cost is minimized whilst meeting the capacity and latency …