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Is Amazon “Spot On?”

by Cameron Haight  |  December 15, 2009  |  1 Comment

Earlier this week, Amazon’s CTO Werner Vogels announced the availability of spot- (or market-) based Amazon EC2 instance pricing.  In essence, a customer would bid a price and as long as the bid exceeds the spot price (and they only pay the spot price), their instances would run.  Once the spot price exceeded the bid price, the instances would terminate thus necessitating that the applications running in the Amazon cloud be able to frequently save their state.  A spot pricing history would be available via the Amazon AWS management console to presumably help with bidding.  This is something that is close to what I predicted in an earlier blog post where I discussed how cloud providers might deal with excess capacity.  Is the theorized future’s exchange now not that far off into the future? 

But this leads us to another area of discussion – how will IT operations be able to leverage this?  We’re still dealing with a great deal of uncertainty about how much services cost to run and support within the current enterprise infrastructure.  Now we have a mechanism to potentially set our price, but upon what basis will we know if our bid is actually “profitable” for us or not?  As I speculated in my earlier post, I see an enhanced role for information gathering and analytical tools to help IT determine optimal pricing in the cloud world.  Is an operations-centric “Bloomberg” terminal providing cost and other relevant cloud service provider information (such as QoS) in our collective futures?  

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Cameron Haight
Research VP
10 years at Gartner
30 years IT industry

Cameron Haight is a research vice president in Gartner Research. His primary research focus is on the management of server virtualization and emerging cloud computing environments. Included in this effort is… Read Full Bio

Thoughts on Is Amazon “Spot On?”

  1. Alex Bakman says:

    I think Werner is infatuated with Google model, but when it comes to running IT bidding and hoping that your instance runs is not going to fly with IT guys. They need cerainty not auction


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