Tuesday, March 10, 2009

Price-at-risk: a methodology for pricing utility computing services.

Price-at-risk: a methodology for pricing utility computing services.: "Utility computing services represent a departure from the current ways of doing business. On one hand, they feature attributes that appeal to customers: short lead times in service provisioning, high reliability and survivability, customized service level agreements, a reduced learning curve in the adoption of a new service, and easy access to new technology. On the other hand, utility computing services have direct financial benefits for the customer. These benefits come about in two distinct ways. First, utility computing services reduce the risk faced by the customer because the costs to the customer are proportional to the volume of transactions performed during a certain time interval (say, a quarter). These transactions are usually correlated with the number of financial transactions performed during the same interval, and therefore with the revenue stream of the customer. Therefore, the cost structure is tied to the revenue"

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