The role of individualization and project learning for cloud service profitability

This article describes how cloud computing has been one of the most important IT topics in recent years. In increasingly greater numbers, service providers have entered this dynamic market turning it into one of the most competitive markets in modern IT industry. As the market matures, many providers are struggling with profitability issues. Studies on cloud services have primarily approached the topic from a technical or customer's perspective, neglecting the provider's perspective. In this article, the authors address business aspects of cloud services from the provider's perspective. Based on an empirical study of 78 cloud service providers, they analyse the impact of service individualization and project learning on service delivery cost and profitability. The results indicate that while project learning merely helps to reduce service delivery costs, service individualization positively affects profitability.