Simple pricing schemes for the cloud

DOI10.1007/978-3-319-71924-5_22MaRDI QIDQ4614079zbMATH OpenOpenAlexFDO

Authors Ian A. Kash, Peter Key, Warut Suksompong

Publication date 30 January 2019

Published in Web and Internet Economics (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/1705.08563

zbMATH Keywords

cloud computingcloud servicespricing schemes

Mathematics Subject Classification ID

Internet topics (68M11) Microeconomic theory (price theory and economic markets) (91B24)

Abstract: The problem of pricing the cloud has attracted much recent attention due to the widespread use of cloud computing and cloud services. From a theoretical perspective, several mechanisms that provide strong efficiency or fairness guarantees and desirable incentive properties have been designed. However, these mechanisms often rely on a rigid model, with several parameters needing to be precisely known in order for the guarantees to hold. In this paper, we consider a stochastic model and show that it is possible to obtain good welfare and revenue guarantees with simple mechanisms that do not make use of the information on some of these parameters. In particular, we prove that a mechanism that sets the same price per time step for jobs of any length achieves at least 50% of the welfare and revenue obtained by a mechanism that can set different prices for jobs of different lengths, and the ratio can be improved if we have more specific knowledge of some parameters. Similarly, a mechanism that sets the same price for all servers even though the servers may receive different kinds of jobs can provide a reasonable welfare and revenue approximation compared to a mechanism that is allowed to set different prices for different servers.

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