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Mathematical Frameworks for Pricing in the Cloud: Revenue, Fairness, and Resource Allocations

As more and more users begin to use the cloud for their computing needs, datacenter operators are increasingly pressed to effectively allocate their resources among these client users. Yet while much work has been done in this area, relatively little attention has been paid to studying perhaps the ultimate lever of resource allocation: pricing. Most data centers today charge users by "bundling" heterogeneous resources together in a fixed ratio and selling these bundles to their clients. But bundling masks the fact that different users require different combinations of resources (e.g., CPUs, memory, bandwidth) to process their jobs. The presence of multiple resources in fact allows an operator to offer many different types of pricing strategies, which may have different effects on its revenue. Moreover, to avoid user dissatisfaction, operators must consider the impact of their chosen prices on the fairness of the jobs processed for different users. In this paper, we develop an analytical framework that accounts for the fairness and revenue tradeoffs that arise in a datacenter's multi-resource setting and the impact that different pricing plans can have on this tradeoff. We characterize the implications of different pricing plans on various fairness metrics and derive analytical limits on the operator's fairness-revenue tradeoff. We then provide an algorithm to navigate this tradeoff and compare the tradeoff points for different pricing strategies on a data trace taken from a Google cluster.