Amazon Lets Businesses Resell Unused Cloud Capacity


Amazon Web Services on Wednesday introduced Reserved Instances Marketplace, which allows businesses using its cloud services to resell unused, reserved server capacity.

Amazon lets businesses using its cloud services pay a low, one-time fee for capacity and receive discounts on the hourly charge for server instances used. The contracts, called Reserved Instances, can last for one or three years.

These Reserved Instances contracts can save businesses up to 71 percent compared to buying capacity on-demand, Amazon said.

[Related: ProfitBricks Targets Amazon, Rackspace With Per-Minute Cloud Pricing]

However, many businesses are reluctant to commit to contracts for one or three years.

Amazon's new marketplace is designed to encourage businesses to commit to the longer reserved contracts, knowing they can sell the capacity they don’t use.

"The Reserved Instance Marketplace allows you to sell your Amazon EC2 Reserved Instances to other businesses and organizations if your needs change (e.g. you want to move instances to a new AWS Region, change to a new instance type, or sell capacity for projects that end before the term expires)," Amazon said on its website.

The new marketplace will be a Web interface where buyers and sellers can come together and make deals for allocating capacity.

"You can also browse the Reserved Instance Marketplace to find an even wider selection of Reserved Instance term lengths and pricing options sold by other AWS customers," Amazon said.

Jeremy Przygode, CEO of Stratalux, a Santa Monica, Calif.-based cloud service provider that builds and manages Amazon cloud solutions for businesses, said Reserved Instance Marketplace is a natural innovation to help companies operate with more flexibility in the cloud at a lower cost.

"Customers did not want to buy Reserved Instances because they might shut [the instance] down or move before the contract expires," he said. "This is a good thing for Amazon because it gives their customers the option of to sell reserved instances, so companies will be freed up to buy more reserved instances."

However, Przygode said it remains unclear how Stratalux, as a reseller of cloud services, will operate in this marketplace. "This just happened," he said. "We need to look at it."

The introduction of Amazon's Reserved Instance Marketplace comes as cloud pricing is gaining increasing attention.

On Monday, Cambridge, Mass.-based infrastructure-as-a-service provider ProfitBricks announced a new data center architecture that allows for pay-per-minute pricing for cloud capacity and the ability to change workloads on the fly.

PUBLISHED SEPT. 12, 2012

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