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IESS 1.0, Geneva, 2009-02-18 Martin Matzner, Oliver Müller Total Cost of Service Life The Need for Decision Support in Selecting, Comparing, and Orchestrating Services

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Total Cost of Service LifeThe Need for Decision Support in Selecting, Comparing, and Orchestrating ServicesMartin Matzner, Oliver Müller

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Page 1: V 5 20100218 Iess Total Cost Of Service Life Korrektur Ol Mu

IESS 1.0, Geneva, 2009-02-18

Martin Matzner, Oliver Müller

Total Cost of Service Life The Need for Decision Support in Selecting, Comparing, and Orchestrating Services

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Total Cost of Service Life

Martin Matzner, Oliver Müller

Motivation

  Services (conventional services and web services) are discovered and evaluated by descriptions of their properties

  Categories of properties: functional and non-functional   Amongst non-functional properties: “price“ for service

consumption

  Research question: “How to evaluate the price of a service ?“

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Status-quo

Pricing lists and simple calculators

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Complexity of the property “price“

  Evaluating a specific service (1)   Comparing several services to each other (2)   Evaluating and comparing orchestrations comprising

several services (3)

  Huge variety of pricing models and conditions   Existence of derivative payments (e.g. opportunity and

capital costs) that are implied by the decision for or against a service

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Pricing models

  Flat-Pricing (cf. Internet or mobile phone flat rates)   Per-packet Pricing (cf. sending short messages)   Parametric Pricing (cf. a translation service that charges

depending on the number of words)   Resource-based Pricing (cf. mobile data transfer)   Lump-sum Pricing   Commission/Brokerage   Hybrid Pricing Models (cf. monthly short message

packages)

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Framework of decision problems

based on Alexander‘s (1970) design principles

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Informing Kernel from Investment Theory

  Payments (instead of costs)   Consider derivative monetary consequences

  capital lockup   interests (based on the opportunity rate of interest of the internal

funds and the outside capital rate of interests)   tax payments

  Entire life-cycle of usage

  Conventional approaches (e.g. “Gartner-TCO“) are insufficient

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VoFi-based TCO calculation

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Ongoing: Application in service marketplaces

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Contact

Martin Matzner ([email protected]) Oliver Müller ([email protected])

Leonardo-Campus 3 48149 Münster