18. Pricing and Capacity Strategies in Cloud Procurement: An Economic Analysis of Multi-Cloud Decisions
Invited abstract in session TD-11: Applications, stream Pricing and Revenue Management.
Thursday, 14:30-16:00Room: U2-200
Authors (first author is the speaker)
| 1. | Tarun Jain
|
| Operations Management, IIM Bangalore | |
| 2. | Jishnu Hazra
|
| Operations Management , IIM Bangalore | |
| 3. | Ram Gopal
|
| Warwick Business School, University of Warwick |
Abstract
Federal agencies frequently use reverse auctions to procure cloud infrastructure services from leading providers such as Amazon, Google, and Microsoft. While prior research has addressed operational aspects of cloud computing, the pricing dynamics in vendor selection under auction-based procurement remain underexplored. This study examines key strategic decisions, including the optimal number of cloud providers in bidding and the trade-off between public cloud procurement and private cloud investments.
Our findings suggest that higher cost heterogeneity among vendors results in fewer selected providers. Interestingly, such variation in pricing can either encourage or discourage private cloud investments. When the market has very few cloud providers, a private cloud strategy is more beneficial. In contrast, a highly competitive vendor landscape favors a public cloud approach. For markets with moderate competition, a hybrid cloud strategy is the most effective choice.
Keywords
- Revenue Management and Pricing
- Capacity Planning
- Strategic Planning and Management
Status: accepted
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