Comparison of Two Yield Management Strategies for Cloud Service Providers

Mohammad Mahdi Kashef (), Azamat Uzbekov (), Jörn Altmann and Matthias Hovestadt ()
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Mohammad Mahdi Kashef: TEMEP, College of Engineering, Seoul National University
Azamat Uzbekov: TEMEP, College of Engineering, Seoul National University
Matthias Hovestadt: Department of Computer Science, Hanover University of Applied Sciences

No 2013103, TEMEP Discussion Papers from Seoul National University; Technology Management, Economics, and Policy Program (TEMEP)

Abstract: Several Cloud computing business models have been developed and implemented, including dynamic pricing schemes. This paper extends the known concepts of revenue management to the specific case of Cloud computing from two perspectives. First, we propose system architecture for Cloud service providers for combining demand-based pricing and scheduling. Second, a comparison of two yield management methods for cloud computing has been compared: Limited Discount Period Algorithm and VM Reservation Level Algorithm. By taking advantage of demand estimation, the two algorithms find the optimum number of VMs that are sold at full price and the optimum time period before the allocation when the prices should change. Simulation results show that both yield management methods outperform static pricing models and the algorithms perform differently considering the deviation of demand.

Keywords: Cloud Computing; Revenue Management; Pricing Strategy; Autonomic Resource Management. (search for similar items in EconPapers)
JEL-codes: C61 C63 D81 L86 M15 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2013-05, Revised 2013-05
New Economics Papers: this item is included in nep-cmp and nep-cwa
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published in Proceedings of the 8th International Conference on Grid and Pervasive Computing (GPC 2013).

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http://temep-repec.my-groups.de/DP-103.pdf First version, 2013 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:snv:dp2009:2013103

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