Pricing cloud bandwidth reservations under demand uncertainty

11 years 7 months ago

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In a public cloud, bandwidth is traditionally priced in a pay-asyou-go model. Reﬂecting the recent trend of augmenting cloud computing with bandwidth guarantees, we consider a novel model of cloud bandwidth allocation and pricing when explicit bandwidth reservation is enabled. We argue that a tenant’s utility depends not only on its bandwidth usage, but more importantly on the portion of its demand that is satisﬁed with a performance guarantee. Our objective is to determine the optimal policy for pricing cloud bandwidth reservations, in order to maximize social welfare, i.e., the sum of the expected proﬁts that can be made by all tenants and the cloud provider, even with the presence of demand uncertainty. The problem turns out to be a large-scale network optimization problem with a coupled objective function. We propose two new distributed solutions — based on chaotic equation updates and cutting-plane methods — that prove to be more efﬁcient than existing solutions bas...

Di Niu, Chen Feng, Baochun Li

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