Dynamic Pricing for Web Service Resource Utilization
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Solution Overview
Problem
Enterprises face inefficiencies in computing resource utilization due to provisioning based on peak demand, leading to underutilization during off-peak periods, resulting in wasted resources and increased costs.
Innovation Solution
Implementing dynamic pricing and incentives for web services computing resources, where prices adjust based on predicted utilization, encouraging customers to use resources during underutilized times through discounts or promotions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If computing resources are provisioned according to peak demand, then service quality is maintained during high-demand periods, but resource utilization efficiency deteriorates during low-demand periods
Solution Approach 1:
The patent implements dynamic pricing that adjusts resource prices based on real-time utilization levels. When utilization is low, prices are reduced to attract more customers and increase utilization. When utilization is high, prices increase to manage demand. This dynamic adjustment resolves the contradiction by making the pricing mechanism flexible rather than static, allowing the system to maintain service quality while optimizing resource utilization across varying demand conditions
Solution Approach 2:
The system changes the pricing parameter based on utilization metrics. By monitoring utilization levels and adjusting prices accordingly, the system transforms a static pricing model into one that adapts to changing conditions. This parameter change enables the system to balance between maintaining service quality during peak periods and improving resource utilization during off-peak periods
2Reliability
If computing resources are provisioned according to peak demand, then customer service levels are maintained, but resource waste increases during off-peak periods
Solution Approach 1:
The patent implements a feedback mechanism where utilization data is continuously monitored and fed back into the pricing system. This feedback loop allows the system to detect when resources are underutilized and automatically adjust prices to stimulate demand. The feedback mechanism resolves the contradiction by enabling real-time optimization that prevents resource waste while maintaining service levels through dynamic price adjustments rather than static over-provisioning
3Productivity
If dynamic pricing is implemented, then resource utilization is optimized, but pricing complexity increases
Solution Approach 1:
The patent implements an automated pricing system that self-adjusts based on utilization metrics without requiring manual intervention. The system autonomously monitors utilization, determines appropriate price adjustments, and implements changes automatically. This self-service approach resolves the contradiction by eliminating the need for complex manual pricing management while achieving optimized resource utilization through algorithmic price adjustment
Data Source
AI summary
A method and system for dynamic pricing of web services utilization. According to one embodiment, a method may include dynamically predicting utilization of a web services computing resource that is expected to occur during a given interval of time, and dependent upon the dynamically predicted utilization, setting a price associated with utilization of the web services computing resource occurring during the given interval of time. The method may further include providing the price to a customer.