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Amazon Unveils Auction Site for Cloud Computing Bandwidth

Tue, 12/15/2009 - 5:34am
Jon Brodkin , Network World

Editor's Note: One day we'll see a data commodities exchange, where all assets and bandwidth from all providers is sold to the highest bidder. We need to be careful that this does not become a venue for speculation.

 

(NetworkWorld) - Amazon's cloud computing division is unveiling an eBay-style auction service that will let users bid on unused virtual server capacity, potentially allowing customers to lower the cost of running applications on Amazon's Elastic Compute Cloud. Known as "Spot Instances," the price of this cloud-based server capacity changes based upon supply and demand, unlike Amazon's usual fixed prices for server instances.

"With Spot Instances, customers bid on unused Amazon EC2 capacity and run those instances for as long as their bid exceeds the current Spot Price," Amazon says. "The maximum price you specify is not necessarily the price that you will pay. For example, if you specify 50 cents as your maximum price and the Spot Price is 30 cents for the period, you will pay only 30 cents. If the Spot Price increases, you will pay the new price (until it exceeds your maximum, at which time your instances will be terminated)."

The fixed pricing scheme, which customers can still access instead of the auction-style pricing, ranges from about 8 cents per hour to $3 per hour.

Since Spot Instances can be terminated without warning, once a customer is outbid, they shouldn't be the only source of capacity allocated to enterprise applications that need 24/7 uptime.

Spot Instances come in the same sizes and software types as fixed-price virtual servers. Amazon says it developed the auction-style system in response to customers who said they wanted additional capacity at lower cost, and were willing to be flexible about when they run their applications.

 

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