SpotCloud: It’s a Market, Not a Cloud

Enomaly, a provider of software to create compute clouds, today announced SpotCloud, a brokerage service that allows Infrastructure-as-a-Service providers a way to sell their excess compute capacity and buyers a way to find smaller regional cloud providers for batch jobs. The service, which will help match supply and demand, as well as offer semi-elastic pricing (instead of elastic think of a belt analogy with several pre-cut holes offering a set number of sizes), is an initial step in creating a true auction-style delivery of compute capacity around the globe.

However, it’s not there yet. Enomaly founder and CTO Reuven Cohen and I chatted last month about the offering, and he compared it to Hotwire, where hotels or airlines sell off unused inventory for cheap, and consumers can bid what they’re willing to pay. Owing to the technical limitations of moving workloads from one cloud to another, dealing with security and compliance and potential incompatibilities from one cloud provider to another, this isn’t a marketplace that delivers a bunch of aggregated compute clouds via a cloud; it’s not elastic in that way. It can’t be an auction-based model by which one bids on unused capacity and suddenly has access to it, but it could be the first step to such a service.

The brokerage model is apparently so compelling that Gartner last month estimated that by 2015 the market for middle men between clouds will be a huge revenue opportunity, and the big players will need to either become brokers or enable them in order to succeed. Enomaly is doing that, and as such, will also boost use of its software, given that its Enomaly ECP product is required for suppliers of SpotCloud. (Other providers software will be supported over time.) A buyer will go to the SpotCloud portal, submit the information on the capacity he needs and will receive information about what’s available. Once a match is made, the price for a set amount of compute capacity over time is locked down. Enomaly handles the billing and monitoring of the usage, and buyers pay by loading up an account in a model similar to what pre-paid phone operators use.

SpotCloud solves a problem, especially for smaller cloud providers that want to sell capacity, and for folks like Soasta – a test and dev cloud service that needs lots of capacity — but it really showcases how far the industry needs to come to truly offer elastic compute and interoperability. While it’s easy to write about the benefits of such elasticity between data centers and between cloud providers, we’re a long way from getting there. So while I’m glad Cohen is tweeting that the buyers of such capacity are signing up at a ratio of five for every one supplier signing up, I’m also glad he’s trying hard to explain what this isn’t as well. There’s already enough marketing fluff when it comes to the cloud; it’s nice Cohen isn’t trying to add more.