Combinatorial Auction-Based Allocation of Virtual Machine Instances in Clouds

The current cloud computing platforms allocate virtual machine instances to their users through fixed-price allocation mechanisms. We argue that combinatorial auction-based allocation mechanisms are especially efficient over the fixed-price mechanisms since the virtual machine instances are assigned to users having the highest valuation. We formulate the problem of virtual machine allocation in clouds as a combinatorial auction problem and propose two mechanisms to solve it. We perform extensive simulation experiments to compare the two proposed combinatorial auction-based mechanisms with the currently used fixed-price allocation mechanism. Our experiments reveal that the combinatorial auction-based mechanisms can significantly improve the allocation efficiency while generating higher revenue for the cloud providers.