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The new hot commodities market: the cloud

AP/Richard Drew
A whole new thing for traders to worry about.
By Christopher Mims
BerlinPublished Last updated This article is more than 2 years old.

Have some spare computing capacity in your data center, aka the “cloud”? Why not make some scratch by selling it on the open market? Or, if you’re so inclined, you could trade derivatives of cloud computing. In place of mortgage-backed securities, perhaps the world’s banks can pour their savings into another abstract financial instrument that depends on the reliability of Amazon’s web services. What could possibly go wrong?

This is the promise of a new exchange for cloud computing capacity, called Cloud Exchange AG, which will launch early next year. It’s a joint venture of Deutsche Börse, which runs the Frankfurt stock exchange, and software development firm Zimory.

Trading computing capacity isn’t as simple as trading, say, wheat. The system implemented by the two firms will allow buyers to specify the location of servers, the precise vendor (e.g. Amazon, IBM, Rackspace), security measures and transfer speed, among other things. The scheme is similar to cloud marketplaces like Reserved Instance Marketplace by Amazon Web Services and SpotCloud by Virtustream, notes Ulrike Dauer at the Wall Street Journal. But on those platforms trade is restricted to one vendor, such as Amazon. The Deutsche Börse system allows trading across vendors.

By 2015, Deutsche Börse hopes to offer derivatives and futures on cloud computing commodities trades. This could lead to a whole new level of collaboration (or competition) between Wall Street traders and their IT departments, as both try to predict the price of cloud computing resources weeks and months ahead.

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