No Reservations: A First Look at Amazon's Reserved Instance Marketplace

TL;DR

This paper analyzes Amazon's Reserved Instance Marketplace by monitoring and archiving its prices over 1.75 years, providing insights into cost-effective cloud provisioning and demand risk mitigation.

Contribution

It presents the first publicly available analysis of RIM prices, offering insights into their characteristics and implications for cloud cost management.

Findings

RIM prices vary significantly across regions and zones.

The data reveals patterns in pricing that can inform reservation strategies.

Amazon's RIM effectively helps users manage demand risk.

Abstract

Cloud users can significantly reduce their cost (by up to 60\%) by reserving virtual machines (VMs) for long periods (1 or 3 years) rather than acquiring them on demand. Unfortunately, reserving VMs exposes users to \emph{demand risk} that can increase cost if their expected future demand does not materialize. Since accurately forecasting demand over long periods is challenging, users often limit their use of reserved VMs. To mitigate demand risk, Amazon operates a Reserved Instance Marketplace (RIM) where users may publicly list the remaining time on their VM reservations for sale at a price they set. The RIM enables users to limit demand risk by either selling VM reservations if their demand changes, or purchasing variable- and shorter-term VM reservations that better match their demand forecast horizon. Clearly, the RIM's potential to mitigate demand risk is a function of its price characteristics. However, to the best of our knowledge, historical RIM prices have neither been made publicly available nor analyzed. To address the problem, we have been monitoring and archiving RIM prices for 1.75 years across all 69 availability zones and 22 regions in Amazon's Elastic Compute Cloud (EC2). This paper provides a first look at this data and its implications for cost-effectively provisioning cloud infrastructure.