Amazon creates cloud computing spot market

Amazon creates cloud computing spot market

Summary: Amazon rolled out spot pricing for cloud computing so customers can buy capacity at any price on the open market.

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Amazon on Monday rolled out spot pricing for cloud computing so customers can buy capacity at any price on the open market.

The concept is an interesting one since Amazon Web Services is making computing capacity available on the market just like any other commodity (see Amazon statement, Werner Vogels and Amazon Web Services blog).

Dubbed Spot Instances, Amazon customers can bid on unused Elastic Compute Cloud (EC2) capacity and run those instances as long as their bid exceeds the spot price. The rub is that you can be outbid.

In a statement, Amazon says Spot Instances "are well-suited for applications that can have flexible start and stop times such as image and video conversion and rendering, data processing, financial modeling and analysis, web crawling and load testing."

Amazon CTO Werner Vogels said on his blog:

The central concept in this new option is that of the Spot Price, which we determine based on current supply and demand and will fluctuate periodically...This gives customers exact control over the maximum cost they are incurring for their workloads, and often will provide them with substantial savings. It is important to note that customers will pay only the existing Spot Price; the maximum price just specifies how much a customer is willing to pay for capacity as the Spot Price changes.

Overall, the flexibility can save money, but you may not get a defined time---at your price---for a project to finish. Spot Instances allows you to define a maximum price you'll pay along with instance family, size and region. Spot Instances can be terminated when they are no longer needed.

Topics: Browser, Amazon, Cloud, Enterprise Software, Hardware, Software, Virtualization

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5 comments
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  • I don't see the benefit to the consumer...

    ...and I mean businesses purchasing processing power by consumer. This is great of Amazon...star a bidding war for computing power. But if you're running a business just how many jobs can you have that don't really matter if they finish or not? What if you end up being continuously outbid before you can finish anything? It doesn't really seem like a good bet financially for smaller businesses though this is who it would suit best technically I believe.
    storm14k
    • An example

      You can't have a job that you don't care if it
      finishes. But you can have jobs that you done
      care much about when they finish. Image
      processing can be like that. If I am doing
      some noise reduction on an old movie that I
      digitize, its possible that a week is about a
      good as a month to me. I can just enter a bid
      lower than the normal EC2 fee. If I bid
      enough, my job will get done at a discount. If
      I don't bid enough, I guess I will just have to
      bid more. If Amazon has to have enough servers
      to meet the demand for the Christmas rush of e-
      retailers at 6 PM on December 20, they probably
      have way too much capacity for 3 AM on January
      8. There were lots of academic researchers
      that had to time share super-computers. Now
      they can just submit jobs to Amazon and use up
      the spare processors on these off-peak times.
      For more of a 'business case', consider data
      mining. You might have high priority data
      processing tasks that are model driven. The
      model can be continually evolving as data is
      mined, but this is a (relatively) low priority
      task. If you can keep within a day or two on
      the data mining & model tuning, that may be
      quite good enough.
      shis-ka-bob
  • isn't that what they used to call GAMBLING?

    Looks to me like las vegas opened a cloud...

    only good for the bank and the gros the consumer will always loose.

    corporate smartness vs consumer stupidity... that's their gamble and ofcourse they win.

    fair is different...
    emenau
  • RE: Amazon creates cloud computing spot market

    Nice innovation. More choice, and you get what you are
    prepared to pay for in terms of delivery time. So of the
    parameters of time, quality and price you can trade off
    time and price against each other. Quality might come
    later in terms of various service level agreements.
    Walter Adamson @g2m
    http://xeesm.com/walter
    walteradamson
  • RE: Amazon creates cloud computing spot market

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