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Article

Abstract

The risk of the implementation of cloud service and the worry about the failure of projects or strategies caused by service disruption is an important reason of low adoption rates of the cloud service. Service disruption not only directly affects the cloud service free trial results, but also leads to compensation to the consumers. The coordination problem between a CFP (cloud function provider) and a CIP (cloud integration provider) in a cloud supply chain is investigated, in which service demand is determined by the application free trial. Coordination Contracts are discussed in two kinds of situations, linked respectively to the information symmetry and information asymmetry. The results show that the cost and risk-sharing coordination contracts we proposed can realize optimal supply chain performance, and Pareto improvement of supply chain members’ profits. Reducing the service disruption probability and improving the level of service reliability are the key to the free trial. Besides, the compensation cost allocation enhances the scalability of cost allocation. Through numerical exploration analysis, effectiveness of the model is demonstrated and some managerial insights are obtained.

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