TVDA: Truthful Volume Discount Auction Design for Cloud Resource Allocation

Market mechanism constitutes an efficient scheme for the allocation of cloud-based computing resources with the view of virtual machines. The volume discount model is a new kind of dynamic pricing economic model on the Internet, which makes the users can form a group through Internet to get the volume discount, i.e., the more units that are bought together, the lower the price of the resource being provided becomes. In this paper, we consider the virtual machine allocation problem in clouds with group buying pricing scheme and propose TVDA, a Truthful Volume Discount Auction to allocate cloud virtual machine instances by taking advantage of the volume discount. TVDA possesses good properties such as truthfulness, individual rationality, ex-post budget balance, system efficiency, and computational tractability. Numerical results are presented to demonstrate the effectiveness of the proposed scheme.