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International Conference on Grid Economics and Business Models

GECON 2014: Economics of Grids, Clouds, Systems, and Services pp 55–66Cite as

Cloud Goliath Versus a Federation of Cloud Davids

Survey of Economic Theories on Cloud Federation

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Part of the book series: Lecture Notes in Computer Science ((LNCCN,volume 8914))

Abstract

Cloud computing, which can be described as a technology for provisioning computing infrastructure as a service, runtime platform as a service, and software as a service, is considered as a keystone for innovation in the IT area. However, a limiting factor to innovation through cloud computing could be the economies of scale and network externalities that give more benefits to larger cloud providers. Due to the economies of scale and network externalities in an oligopolistic environment, a giant cloud provider can offer resources at lower cost than smaller providers. To overcome the disadvantage of small clouds, some research proposes architectures, in which small clouds can federate through common virtual interfaces. Therefore, academy and industry ask whether the federation of small cloud providers is economically feasible and can compete with a giant cloud provider. However, it is hard to solve those problems because the specifications of a cloud federation and the conditions of cloud market are unclear. To fill this gap, in this paper, we survey the conceptual background of cloud computing and the federation of small cloud providers. The results of this paper are expected to guide how to define the economic problems on cloud federation and provide constraints to the problems.

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Acknowledgements

This work has been funded by the Korea Institute for Advancement of Technology (grant no. ITEA2 10014) as part of the ITEA2 project EASI-CLOUDS.

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Authors and Affiliations

  1. Technology Management, Economics and Policy Program College of Engineering, Seoul National University, Gwanak-Ro 1, Gwanak-Gu, Seoul, 151-742, South Korea

    Kibae Kim, Songhee Kang & Jörn Altmann

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  1. Kibae Kim
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  2. Songhee Kang
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  3. Jörn Altmann
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Correspondence to Jörn Altmann .

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Editors and Affiliations

  1. Technology, Economics, and Policy Program, College of Engineering, Seoul National University, Gwanak-Gu, Seoul, Korea, Republic of (South Korea)

    Jörn Altmann

  2. Department of Mathematics and Computer Science, University of Antwerp, Antwerp, Belgium

    Kurt Vanmechelen

  3. School of Computer Science, Cardiff University, Cardiff, United Kingdom

    Omer F. Rana

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Kim, K., Kang, S., Altmann, J. (2014). Cloud Goliath Versus a Federation of Cloud Davids. In: Altmann, J., Vanmechelen, K., Rana, O. (eds) Economics of Grids, Clouds, Systems, and Services. GECON 2014. Lecture Notes in Computer Science(), vol 8914. Springer, Cham. https://doi.org/10.1007/978-3-319-14609-6_4

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  • DOI: https://doi.org/10.1007/978-3-319-14609-6_4

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  • Publisher Name: Springer, Cham

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