The new hot commodities market: the cloud; Deutsche Börse to launch Cloud Exchange for spare cloud computing capacity

The new hot commodities market: the cloud

By Christopher Mims @mims July 2, 2013

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.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: