What do a hotel and a cloud services provider have in common? They both have perishable inventory. An unsold hotel room for the night is essentially spoiled. Similarly, compute cycles on a cloud provider’s infrastructure that aren’t used are also wasted.
“Once a moment of time has gone by, you can never sell it again,” says Reuven Cohen, founder and chief technology officer of Toronto-based Enomaly Inc. The company recently launched the SpotCloud Marketplace Platform, essentially a brokerage that sells unused cloud capacity to users who need it.
Like the cut-rate hotel rooms you might find on Hotwire.com, SpotCloud allows public cloud service providers the opportunity to at least get something for that unused capacity. Even if it’s well below retail pricing, Cohen says, it’s better than getting nothing.
Enomaly built an intermediary platform on Google Inc. App Engine that distributes customer virtual machine images to cloud hosts with extra capacity. Cohen says the system uses a very simplified virtual machine format, essentially a primary hard drive partition zipped up with an XML manifest.
While the provider is actually offering infrastructure-as-a-service, the end result looks more like a platform-as-a-service offering, Cohen says.
Gartner Inc. managing vice-president Daryl Plummer wrote in a report that 25 per cent of cloud services could be consumed through a broker by 2015.
“One way to mitigate risk and enhance the value of services delivered through the cloud is to use intermediaries to support the needs of the consumer or consuming enterprise,” he wrote in Defining Cloud Services Brokerage: Taking Intermediation to the Next Level.
John Sloan, lead research analyst with London, Ont.-based Info-Tech Research Group Ltd., says the best sell for brokerages right now is “non-durable applications” – those with a beginning and an end, as opposed to core infrastructure.
“You’re looking at capacity that maybe you don’t have,” he says. Look at it this way, he says: You need a truck. Maybe you don’t have a truck, or the truck you have is being used for something else. So you rent a truck, taking into consideration its appropriateness to the load, the rental company’s roadside service and insurance arrangements, etc.
Likewise, the consuming enterprise would be looking at the base cost of the cloud service, the provider’s reputation for security, service level agreements and the like. “If you can get the best deal for your truck/cloud service, there’s some value there,” Sloan says.
But you don’t rent a truck for five years. “At some point, the cost of the rental over time may surpass the cost of a truck,” Sloan says.
Enomaly launched SpotCloud with a group of about 15 providers on board, but since then has been “inundated,” Cohen says. He says almost every significant public cloud provider is on board.
While it’s an easy sell to providers, he says – “Everybody wants to make more money” – there’s also been good take up on the consumption side, too. Cohen estimates about a four- or five-to-one ratio of customers to providers.
“I think we’ve got the right mixture of simplicity and timing,” Cohen says.