Article ID Journal Published Year Pages File Type
552404 Decision Support Systems 2008 11 Pages PDF
Abstract

Grid computing essentially involves transparent access to distributed computing where computing resources are pooled and shared both within and among organizations. Grid computing is increasingly becoming a viable option for businesses looking for high-end computing requirements for relatively short periods of time. We analyze some economic decision criteria for a grid computing provider wishing to provide such a service to businesses. Given the large amount of uncertainty in prices and demand (which is demonstrated through Monte Carlo simulations) for such a service, a real options valuation technique is particularly suitable for such an exercise. We study the dynamics of grid computing from an economic perspective. Specifically, we consider a monopolist scenario providing two kinds of service, one of which might preempt the other.

Related Topics
Physical Sciences and Engineering Computer Science Information Systems
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