Reliability based micro-economic cost model for cloud computing systems

An increasing number of industries are shifting their operations to cloud computing platforms. A large number of these users outsource their needs to different cloud providers. In such a scenario it becomes imperative to study the economics of these systems. In this work we present a micro-economic model to maximize the profit of a cloud service providers. The profits of such firms depends highly on the reliability of the system and the quantity of resources employed. A profit function formulated has been modified to consider the reliability of the system as a major component on the profitability of the firm. The cloud system has been modelled using queuing theory and a profit optimization problem has been formulated using the principles of producer side micro-economics.