GigaOM Pro

Amazon Web Services has launched Reserved Instance Marketplace, a way for customers to sell off the remainder of their Reserved Instances if they over-provisioned them. Reserved Instances are less expensive than on-demand instances, but lock users into a 1-3 year contract. This was discouraging for companies, especially web startups whose computing needs can change dramatically. AWS expects customers to use the marketplace 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 will charge the seller a 12% service fee to complete the transaction. It’s an interesting move by AWS, but one that’s been tried before without much success. Virtustream acquired Enomoly, which built SpotCloud, a brokerage service that allows Infrastructure-as-a-Service providers a way to sell their excess compute capacity. It failed to take off. Amazon has considerably more business on its cloud than any other IaaS provider, so there’s more chance of its marketplace getting traction. But it’s still a closed system, limited to trading machines that exist within Amazon’s data centers. The more exciting opportunity would be a marketplace that encompasses all IaaS providers, creating a real exchange for compute.