TRANSFORMATION TOWARD A CLOUD BUSINESS MODEL

This paper discusses value creation and capture in the Cloud setting. Two matters are being considered. First, the authors highlight that the current de-facto tool for crafting business models in the IT industry, i.e. the business model canvas, does not well reflect the networked business settings. Instead, the authors argue, value is often created and captured in co-operation with many companies. The authors introduce early evidence of such co-operation, with a case description of two companies collaborating in common attempt to create a test hotel concept. Second, the test hotel case enables authors to illustrate the changes in business models elements ensuing from transition to Cloud technologies. Both the value creation and capture are affected, which is highly difficult issue for incumbents running their existing business.

Overall, the reviewer thinks the paper communicates these two messages in concise and compelling manner. Discussion on business models and transformation of software business is timely and applicable for the themes of the CFP. The essential details of the method and the case are provided.

There is also room for improvement. First, the research question contains two parts, i.e. *what* is the transformation to cloud and *how* companies should transform. The latter question remains unanswered in the paper. Second, novel concepts of co-creation, co-capture and co-opetition are only briefly and vaguely defined. Third, the authors should indicate whether there are existing studies on cloud transformation, enabling discussion of the contribution of the paper. Further, the authors mix and match action research and case study terminology and it is therefore unclear whether the authors were purely observers or actively influencing the change. Then, most of the implementation steps in table 2 do not contain any changes from present to future. Finally, abstract could be rewritten to contain all the main results and contribution of the paper.

Editor

Thank you for the authors for the revised version. You could also make the re-review work easier by responding to the their comments directly.

For the reviewer of our paper “Transformation towards a cloud business model.

We are grateful for the valid feedback and comments we received on the paper. We have now revised the paper according to the feedback, and would like to explain the changes by answering individually to each notion/ suggestion provided by the reviewer.

Suggestion 1: There is also room for improvement. First, the research question contains two parts, i.e. *what* is the transformation to cloud and *how* companies should transform. The latter question remains unanswered in the paper.

Our comment: The reviewers had a valid point in this, and after a careful consideration, we decided to tighten the focus of the paper and concentrate only on the *what* question at the revised version. Thus, the *how* question was removed from the paper completely.

Suggestion 2: Second, novel concepts of co-creation, co-capture and co-opetition are only briefly and vaguely defined.

Our comment: These definitions have been refined to better communicate their meaning to the readers. However, due to the extremely limited space allowed at this publication, it was not possible to discuss these concepts in greater detail.

Suggestion 3: Third, the authors should indicate whether there are existing studies on cloud transformation, enabling discussion of the contribution of the paper.

Our comment: These issues have been discussed more clearly in the revised version of the paper.

Suggestion 4: Further, the authors mix and match action research and case study terminology and it is therefore unclear whether the authors were purely observers or actively influencing the change.

Our comment: Reason for this is, that we see our research as action research driven case study (i.e. research case examined through action research methods), which resulted a description of the research through both case study and action research concepts. However, as the reviewers saw this confusing, we decided to concentrate on describing the research only through the action research terminology. Given the limited space of the paper, we saw this providing the clearest understanding for the reader for how the research was conducted.

Suggestion 5: Then, most of the implementation steps in table 2 do not contain any changes from present to future.

Our comment: The table has been slightly elaborated in order to crystallize the change taking place from present to future.

Suggestion 6: Finally, abstract could be rewritten to contain all the main results and contribution of the paper.

Our comment: The abstract was rewritten according to the comment.

Thank you again for the review comments.

Kind Regards, Jenni Myllykoski and Petri Ahokangas.

I've reviewed the new version. I find that the new version communicates the original message and the authors have addressed the reviewer comments in enough detail. The results from the initial action research cycle and the conclusions provide a fair answer to the research questions, i.e. Cloud Computing changes every aspect of the software firm's business model.

Editor Decision

Congratulations!
Based on the reviewer comments your manuscript has reached a high level of maturity. It is now accepted for publication in the forthcoming issue of the Communications of Cloud Software journal.