Amazon Introduces Bidding For EC2 Compute Time

ryanvm alerts us to Amazon's beta announcement this morning for what it is calling Spot Instances, which represent a name-your-own-price way of using the elastic compute service. Here is Amazon's documentation on the feature. "For customers with flexibility in when their applications can run, Spot Instances can significantly lower their Amazon EC2 costs. Additionally, Spot Instances can provide access to large amounts of additional capacity for applications with urgent needs." Customers can use the EC2 API to see recent spot prices.

Comments

Re:Indictment of cloud computing?

[enoz]

In order for EC2 capacity to be highly available (I haven't yet heard of people waiting in a queue for hours for an instance), it seems obvious that Amazon must have a large amount of computing power in standby.

This process of auctioning off the extra processing power based on fluctuating capacity seems like a win-win situation for Amazon AND users. Users who want increased processing, but are not time-bound, can get "off-peak" rates. Meanwhile Amazon can make money off the "idle" processors which are still available to be reserved as an EC2 instance.

Re:Instance creation?

[Anonymous Coward]

Initially when you get your EC2 account, it is limited to 20 concurrent VMs. You then have to request to have this limit increased, but the same pricing applies (at least up to 200 concurrent VMs)

Having accounts limited to 20 VMs means that a single user can't sign up and start to flood the system. Also they make no guarantees that a request to start up a VM will succeed unless you have a reserved instance, which has a yearly cost attached.

What this spot pricing does is provide a financial incentive for customers to move load to off peak times rather than adding to the load during peak demand. This in turn should flatten out the load on EC2 (depending on how much load can and will be moved to the off peak times).

In the end this is simple supply and demand economics, and a lot of people in academia have been carrying on about this and a "cloud marketplaces" for quite some time...

Re:Brilliant market for surplus

[Chuck Chunder]

Since an EC2 server not running an EC2 instance is literally burning cash for Amazon

I know the USD has been slipping but surely grid electricity is still a cheaper source of energy then using your own greenback powered generator?