Competitions among Service Providers in Cloud Computing: A New Economic Model

Abstract

Cloud computing has emerged as a new computing paradigm, with provisioning model generally consisting of cloud service providers (CSPs), network service providers (NSPs), and end users. The associated economics has opened up a new research area; and with the expansion of the cloud computing market, the relationship between CSPs and NSPs, is changing profoundly. In addition to providing the default network services, traditional NSPs, in attempt to compete with CSPs, have started offering cloud services to end users. Though much progress has been made toward addressing competitions among CSPs themselves or among NSPs themselves, few studies have focused on the competition between CSPs and NSPs. In this paper, we investigate the problem of insufficient studies on the competition between CSPs and NSPs by presenting a new economic model to characterize the competition between CSPs and NSPs, and by conducting thorough theoretical analysis as well as numeric experiments to validate the proposed model. We believe, based on results, that the proposed economic model is general and feasible, and thus is applicable to modeling the competition among service providers in cloud computing market.