Study on Pricing Strategy for Cloud Services based on Contract Theory

Cloud services providing has been developed with the increasing amount for cloud computing market. Multiple pricing strategies have been proposed to evaluate the commercial value for the heterogeneous cloud services. However, from the perspective of economics study, the profit from the whole business is generated not only depending on the benefit maximization for cloud service provider but also needs to encourage users to participate into the market. To this end, a contract-based pricing strategy for heterogeneous cloud services is proposed where users with different request level pay the price to the cloud service provider for the corresponding servings. The optimal contract is derived to maximize the profit for the cloud service provider under the constraints for maintaining the user attractiveness into the business. More discussion beneath such economic model is presented through exploring the effect for user preference on the optimal contract generation.