Previous studies have introduced different potential pricing strategies for cloud services.\nHowever, not much research has been done comparing subscription pricing and pay-per-use pricing,\nwhich are commonly used pricing schemes. Also, there are very few studies which analyze a two-part\ntariff pricing scheme for cloud services, even though this option may increasingly attract service\nproviders as the cloud market becomes more competitive and the profit margin grows narrower.\nPrevious research has focused on firmsâ?? profitability rather than social welfare due to the limitations\nof free services. This study uses theoretical and numerical analysis to compare the social welfare and\nprofitability of three pricing schemes commonly used by firms: subscription pricing, pay-per-use\npricing, and two-part tariff pricing. It shows that the pay-per-use pricing is the best solution from the\nperspective of social welfare, which contrasts with the conclusion of a previous study stating that\nsocial welfare is maximized under a two-part tariff. This paper also shows that the two-part tariff is\nthe most profitable pricing scheme for firms.
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