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When 36 month instances are always purchased, profits cycle every 36 months.
In the rapid growth market, the optimum threshold is 0.5 for 12 month instances and 0.72 for 36 months.
In our experiments, the worst performing case was when the broker purchases 12 month instances when the market grows rapidly and reserved instances were always purchased by broker.
A similar pattern is seen for 12 month instances, illustrated in Figure 10, where more reserved instances are available than required.
However, when rapid growth hits, the reserved instances will be better utilised and become more profitable--when this happens, the 36 month instances reap the benefits by being available for times of boom, hence the higher threshold.
However, even in this scenario the broker still manages to make a total profit of $0.8 M. By considering past performance through the use of the optimum threshold, and purchasing 36 month instances instead of 12-month ones, the broker can increase its profit by 44% in the same market conditions.
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In the following month, the broker delivers one-month instances to users that exercise their options.
Furthermore, we show that the broker can increase profits by up to 33% by investing in 36-month instances over 12-month.
If users choose instead to purchase resources directly from the provider, they will expect to pay p i P D, where P D is the on-demand cost of a one-month instance (in WZH's model, P D = 2 [11]).
Table 2 Increase in profits achieved by using 36-month reserved instances over 12-month reserved instances (θ= Threshold) θ= 0 θ= θ opt Rapid Growth 30.7% 27.0% Steady Growth 33.1% 31.2% Recession & Recovery 22.3% 9.1% Steady 22.0%29.6%%.
Figure 6 Total profit achieved for different thresholds using 12 month reserved instances.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com