The Pricing of Cloud Computing with Preferential Policies

Abstract

At present, the studies of cloud computing pricing remain at a single period market, and the change of customer demand as well as carrier strategy has been neglected. In this paper, we discuss the dynamic pricing and marketing strategies of carriers in the two-stage market by adding the factor of discount, compare the pricing models of one-stage market and two-stage market, and analyze the effects of network effects, switching costs and transportation cost to the prices. The result shows that cloud computing carriers usually set a higher price in the first stage and then a lower price in the second stage, carriers set the prices for various types of customers on the basis of switching cost in the second stage of the market, cloud carriers can widen the gap with others and improve their revenue by improving the features of their services and products.