Since usage patterns of information technology within organizations can be bursty, the peak demand for IT resources can at times exceed the installed capacity within the enterprise. If providers of such peak capacity emerge, as was the case for electricity and natural gas, the problem arises as to how to efficiently provide and price such peak demand. This paper presents a swing option mechanism that allows for the efficient pricing of IT resources ranging from CPU usage to storage and bandwidth. The use of these swing options serves as an incentive to the users to accurately forecasts of their own needs, thus leading to more efficient utilization of the provider's resources.
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