The impact of cloud services on independent software vendors: Should we step into cloud?

Jhih Hua Jhang-Li, Chih Yao Lee

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

Abstract

Cloud services have become one of the most popular industry terms since Google and IBM invested to build large data centers that users can program and research over the Internet. In practice, IT corporations often annually pay independent software vendors considerable license fees to save the cost of software upgrade and technology support. Although cloud services are considered a cost-down solution for small or medium IT corporations, there are some limitations making IT corporations hesitate to adopt it. In this research, we examine the investment strategy and profit for cloud service providers to better understand the business model of cloud services. We find that a cloud service provider with R&D capability will prefer vertical competition rather than partnering with an independent software vendor. In addition, for independent software vendors, maintaining a loose partnership is better than a tight one. Finally, we suggest that an independent software vendor shouldn't support its cloud partner to enhance service security and compatibility, both of which may reduce its overall profit.

Original languageEnglish
Title of host publicationE-Life
Subtitle of host publicationWeb-Enabled Convergence of Commerce, Work, and Social Life - 10th Workshop on E-Business, WEB 2011, Revised Selected Papers
PublisherSpringer Verlag
Pages289-301
Number of pages13
ISBN (Print)9783642298721
DOIs
StatePublished - 2012
Event10th Workshop on E-Business on E-Life: Web-Enabled Convergence of Commerce, Work, and Social Life, WEB 2011 - Shanghai, China
Duration: 4 Dec 20114 Dec 2011

Publication series

NameLecture Notes in Business Information Processing
Volume108 LNBIP
ISSN (Print)1865-1348

Conference

Conference10th Workshop on E-Business on E-Life: Web-Enabled Convergence of Commerce, Work, and Social Life, WEB 2011
Country/TerritoryChina
CityShanghai
Period4/12/114/12/11

Keywords

  • Cloud Services
  • Durable Goods
  • Independent Software Vendor
  • Software Renting

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