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In this article, we explore the efficacy of dynamic effective capacity modulation (i.e., using virtualization techniques to offer lower resource capacity than that advertised by the cloud provider) as a control knob for a cloud provider’s profit maximization complementing the more well-studied approach of dynamic pricing. In particular, our focus is on emerging cloud ecosystems wherein we expect tenants to modify their demands strategically in response to such modulation in effective capacity and prices. Toward this, we consider a simple model of a cloud provider that offers a single type of virtual machine to its tenants and devise a leader/follower game-based cloud control framework to capture the interactions between the provider and its tenants. We assume both parties employ myopic control and short-term predictions to reflect their operation under the high dynamism and poor predictability in such environments. Our evaluation using a combination of real data center traces and real-world benchmarks hosted on a prototype OpenStack-based cloud shows 10% to 30% profit improvement for a cloud provider compared with baselines that use static pricing and/or static effective capacity.@en

As energy costs become increasingly greater contributors to a cloud provider's overall costs, it is important for the cloud to recoup these energy costs from its tenants for profitability via appropriate pricing design. The poor predictability of real-world tenants' demand and demand responses (DRs) make such pricing design a challenging problem. We formulate a leader-follower game-based cloud pricing framework with the goal of maximizing cloud's profit. The key distinguishing aspect of our approach is our emphasis on modeling both the cloud and its tenants as working with low predictability in their inputs. Consequently, we model them as employing myopic control with short-term predictive models. Our empirical evaluation using tenant trace from IBM production data centers shows that (i) cloud's profit and VM prices are sensitive to the tradeoffs between its energy costs, tenant's demand and DR, and (ii) the cloud's estimation of tenants' demands/DR may significantly affect its profitability.

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