Bazaar-Contract: A Smart Contract for Binding Multi-Round Bilateral Negotiations on Cloud Markets

Abstract

Amazon's EC2 On-Demand marketspace is the dominant platform for trading Cloud services such as virtual machines. On such platforms consumers and providers do not negotiate with each other. Instead, consumers purchase predefined virtual machines at fixed-prices and so this approach is also termed take-it-or-leave-it approach. In the last years more dynamic platforms emerged such as Amazon's spot marketspace which was relaunched at the end of 2017 - here consumers can bid for virtual machines. The recent efforts of Amazon and other Cloud providers such as VirtuStream show that dynamic trading mechanisms are a promising approach for realizing future Cloud markets. Hence, multi-round bilateral negotiations which are executed autonomously have gained popularity in the scientific community. A key challenge towards the adoption of autonomous multi-round bilateral negotiations is to ensure the integrity and transparency so that the generated agreements are legally biding. In the paper at hand we present an approach which uses a smart contract - called Bazaar-Contract - to ensure integrity and transparency during multi-round bilateral negotiations. Thereby, consumers and providers exchange offers by calling methods of the Bazaar-Contract. Moreover, Cloud referees can use these Bazaar-Contracts in order to manage penalties resulting from poor service quality. In order to prove the technical feasibility of our approach we implemented the Bazaar-Contract using Ethereum and the Inter-Planetary File System. We evaluate the economical feasibility of our approach by considering the gas costs.