Virtual Machine Trading in a Federation of Clouds: Individual Profit and Social Welfare Maximization

By sharing resources among different cloud providers, the paradigm of federated clouds exploits temporal availability of resources and geographical diversity of operational costs for efficient job service. While interoperability issues across different cloud platforms in a cloud federation have been extensively studied, fundamental questions on cloud economics remain: When and how should a cloud trade resources (e.g., virtual machines) with others, such that its net profit is maximized over the long run, while a close-to-optimal social welfare in the entire federation can also be guaranteed? To answer this question, a number of important, inter-related decisions, including job scheduling, server provisioning and resource pricing, should be dynamically and jointly made, while the long-term profit optimality is pursued. In this work, we design efficient algorithms for inter-cloud virtual machine (VM) trading and scheduling in a cloud federation. For VM transactions among clouds, we design a double-auction based mechanism that is strategyproof, individual rational, ex-post budget balanced, and efficient to execute over time. Closely combined with the auction mechanism is a dynamic VM trading and scheduling algorithm, which carefully decides the true valuations of VMs in the auction, optimally schedules stochastic job arrivals with different SLAs onto the VMs, and judiciously turns on and off servers based on the current electricity prices. Through rigorous analysis, we show that each individual cloud, by carrying out the dynamic algorithm in the online double auction, can achieve a time-averaged profit arbitrarily close to the offline optimum. Asymptotic optimality in social welfare is also achieved under homogeneous cloud settings. We carry out trace-driven simulations to examine the effectiveness of our algorithms and the achievable social welfare under heterogeneous cloud settings.