Amazon buys ClusterK, a firm that helps users buy cloud capacity cheap

ClusterK helps companies use AWS spot instances for mission-critical applications

Amazon has acquired ClusterK, a developer of software that helps companies run mission-critical applications on spare cloud compute capacity sold by Amazon Web Services.

A spokeswoman for AWS confirmed the acquisition, but did not provide further details.

Spot instances are spare Amazon EC2 (Elastic Compute Cloud) instances for which users name their price. The price for the spot instances can vary in real-time depending on demand and supply. The instance will run until the spot price exceeds the bid or the user terminates it.

This is in contrast with AWS On-Demand instances that let users pay for compute capacity by the hour without long-term commitments, or Reserved instances, which provide capacity reservation. AWS has positioned spot instances as the option to use when customers have flexibility in when their applications can run.

ClusterK in Palo Alto, California, however, promised customers high availability even when using the lower-cost spot instances. "Any single Spot Market can be highly volatile and, in isolation, not appropriate for mission critical applications," it wrote on its website. ClusterK automates the use of multiple instance types, across multiple availability zones to create a highly available platform ideal for mission-critical applications, it added.

If available spot markets disappeared or exceeded On-Demand pricing, ClusterK's Balancer would rebalance to On-Demand capacity to ensure the application remains available, and then "opportunistically rebalance" to spot markets as they became available and cost-effective.

AWS may have decided to buy the startup to give its customers cheaper cloud options around its spot instances, even as its competitors are cutting prices.

Amazon paid between US$20-50 million for ClusterK, an investor in the startup told VentureBeat in an interview.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is

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Tags business issuesamazon.comClusterKcloud computinginternetMergers and acquisitions

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John Ribeiro

IDG News Service
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