Energy Aware Pricing in a Three-Tiered Cloud Service Market

We consider a three-tiered cloud service market and propose an energy efficient pricing strategy in this market. Here, the end customers are served by the Software-as-a-Service (SaaS) providers, who implement customized services for their customers. To host these services, these SaaS providers, in turn, lease the infrastructure related resources from the Infrastructure-as-a-Service (IaaS) or Platform-as-a-Service (PaaS) providers. In this paper, we propose and evaluate a mechanism for pricing between SaaS providers and Iaas/PaaS providers and between SaaS providers and the end customers. The pricing scheme is designed in a way such that the integration of renewable energy is promoted, which is a very crucial aspect of energy efficiency. Thereafter, we propose a technique to strategically provide an improved Quality of Service (QoS) by deploying more resources than what is computed by the optimization procedure. This technique is based on the square root staffing law in queueing theory. We carry out numerical evaluations with real data traces on electricity price, renewable energy generation, workload, etc., in order to emulate the real dynamics of the cloud service market. We demonstrate that, under practical assumptions, the proposed technique can generate more profit for the service providers operating in the cloud service market.