Migration to the Public Cloud

Tong Wang

No 35, EUI-RSCAS Working Papers from European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS)

Abstract: Along with the development of cloud computing technology, website owners begin to consider migrating their website from private in-house server to public cloud servers. In this paper, we use a principal-agent model to analyze the underlying economic trade-offs of such migration and then extend it into a dynamic environment. Our results indicate that the trade-off between market information precision and rent extraction affects the decision choice between private server and public cloud in the short run, in the long run, the rent extraction effect diminishes and the demand for public cloud increases. In a long run equilibrium, private servers exist but are constrained to a comparatively low level.

Date: 2013-06-04
New Economics Papers: this item is included in nep-cta
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Working Paper: Migration to the Public Cloud (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:erp:euirsc:p0341

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