What's Next for Cloud?
Joe Weinman · 2012
This chapter discusses how various quantitative factors and qualitative factors might impact the evolution of the cloud computing market, pricing for cloud services, and the roles of participants in the cloud ecosystem. Pay per use will dominate over flat rates when there are broad dispersion of consumption levels; nonzero marginal cost of goods sold, making such consumption differences profitability impacting; and perfect competition, driving prices down to those marginal costs. Even if users are randomly divided between flat-rate and pay-per-use service providers, the light users migrate to pay per use and the heavy ones migrate to flat rates. Over time, the flat-rate price would rise, driving more shifts to pay per use. In the end, only some of the heaviest users would be left using the flat-rate plan. One recent assessment of the emerging cloud computing ecosystem identified six major roles for cloud service providers: infrastructure, such as physical equipment and also identity and billing; platforms, such as development environments, open source projects, and standards organizations; software, from software as a service (SaaS) vendors, SaaS marketplaces, cloud resellers, and cloud distributors; services, such as certification, audit and compliance, and certification; partners, such as consulting, integration, and outsourcing, and communities, such as development and test. In such a world, partners, third parties, and intermediaries—some of which are sometimes called cloud service brokers—would play a key role.