In cloud computing, big service providers rule the market due to the economies of scale. A cloud federation presents a possible solution that allows small cloud providers to increase their competitiveness by making alliances with one another, thus forming a network with shared resources. Previous research suggests several different variables that may incentivize the participation of a selfish cloud provider, such as cost disparity, big competitors, and an efficient revenue sharing mechanism. It can be assumed that each individual cloud provider aims to maximize its profits and will choose to make alliances that provide it a constant benefit. For deciding on whether to federate or not, cloud providers take into consideration whether the federation-underlying revenue sharing will yield them an increase in profits.The proposed study models the interactions between selfish heterogeneous agents in a repeated game that aims to maximize individual profits. Each agent starts off as an individual and is allowed to change its strategies and federate with other providers in order to improve its own performance. By looking at the speed of collaboration and overall profit of individuals, we can determine which specific incentives encourage the creation of cloud federations.
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