In April 2012, Rogers and Cliff (R&C) demonstrated a theoretical financial brokerage model for cloud computing that is\nprofitable for the broker, offers reduced costs for cloud users, and generates more predictable demand flow for cloud\nproviders. Relatively cheap, long-term reserved instances (RIs) are bulk-purchased by the broker, and then\nre-packaged and re-sold as monthly options contracts at a price lower than a user can purchase ââ?¬Å?on-demandââ?¬Â from\nthe provider. Thus, the broker risks exposure on purchase for margin on sales. R&Cââ?¬â?¢s result has generated significant\ninterest in the cloud computing community and is currently the fifth most accessed research paper of all time in the\nJournal of Cloud Computing: Advances, Systems and Applications.\nHere, we perform an independent replication of R&Cââ?¬â?¢s brokerage model using CReST, a discrete event simulation\nplatform for cloud computing developed at the University of Bristol. We identify two implementation problems in\nR&Cââ?¬â?¢s original work: firstly, the broker buys fewer RIs than the model suggests; and secondly, the broker is\nundercharged for RIs used. We correct R&Cââ?¬â?¢s results accordingly: while brokerââ?¬â?¢s profits are not as high as R&C suggest,\nthe model still supports the theoretical possibility of a profitable brokerage.\nHowever, aggressive competition between cloud providers has reduced the cost of cloud services to users and led to\nthe introduction of new secondary markets where users can buy and sell RIs between themselves. This has squeezed\nthe opportunity for an intermediary brokerage. By recalibrating R&Cââ?¬â?¢s model to fit current market conditions, we\nconclude that the commercial viability of R&Cââ?¬â?¢s brokerage model has been eradicated. The window of opportunity\nhas now closed.
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