On the Economics of Cloud Markets
Ranjan Pal, Pan Hui

TL;DR
This paper models the economic interactions among cloud providers, analyzing how they set prices and QoS levels in a competitive market to optimize profitability and market presence.
Contribution
It introduces three inter-organizational economic models for cloud markets and proves the existence of unique Nash equilibria in two of them.
Findings
Existence of unique pure strategy Nash equilibrium in two models.
Guidelines for cloud providers to set prices and QoS levels.
Insights into capacity provisioning for QoS guarantees.
Abstract
Cloud computing is a paradigm that has the potential to transform and revolutionalize the next generation IT industry by making software available to end-users as a service. A cloud, also commonly known as a cloud network, typically comprises of hardware (network of servers) and a collection of softwares that is made available to end-users in a pay-as-you-go manner. Multiple public cloud providers (ex., Amazon) co-existing in a cloud computing market provide similar services (software as a service) to its clients, both in terms of the nature of an application, as well as in quality of service (QoS) provision. The decision of whether a cloud hosts (or finds it profitable to host) a service in the long-term would depend jointly on the price it sets, the QoS guarantees it provides to its customers, and the satisfaction of the advertised guarantees. In this paper, we devise and analyze…
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Taxonomy
TopicsCloud Computing and Resource Management · Blockchain Technology Applications and Security · Auction Theory and Applications
