On Estimating Minimum Bids for Amazon EC2 Spot Instances

Consumers can realize significant cost savings by procuring resources from computational spot markets such as Amazon Elastic Compute Cloud (EC2) Spot Instances. They can take advantage of the price differentials across time slots, regions, and instance types to minimize the total cost of running their applications on the cloud. However, Spot markets are inherently volatile and dynamic, as a consequence of which Spot prices change continuously. As such, prospective bidders can benefit from intelligent insights into the Spot market dynamics that can help them make more informed bidding decisions. To enable this, we propose a descriptive statistics approach for the analysis of Amazon EC2 Spot markets to detect typical pricing patterns including the presence of seasonal components, extremes and trends. We use three statistical measures -- the Gini coefficient, the Theil index, and the exponential weighted moving average. We also devise a model for estimating minimum bids such that the Spot instances will run for specified durations with a probability greater than a set value based on different look back periods. Experimental results show that our estimation yields on average a bidding strategy that can reliably secure an instance at least 80% of the time at minimum target guarantee between 50% and 95%.