Migration to the Public Cloud

Tong Wang

No 2013/35, RSCAS Working Papers from European University Institute

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.

Keywords: Cloud Computing; Agency Cost; Dynamic Migration. (search for similar items in EconPapers)
Date: 2013-06
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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