Cloud Services

Amazon Patents Digital Cash for à la Carte Cloud Computing

Amazon won a patent for allowing customers to pay for cloud services with Bitcoin or other digital currency, opening the door for anonymous, pay-as-you-go cloud computing, according to a report.

Patent 8,719,131, filed March 21, covers a system for paying for computing resources in a multi-tenant environment. Resources could be allocated anonymously -- not be associated with a specific user account, according to CoinDesk, a digital currency news site. Users would submit the payment as part of the request for resources. (See Amazon Awarded Bitcoin-Related Cloud Computing Patent.)

    Speed is essential, for example, as a user might request access to a server for just two hours and pay for it digitally.

    The patent could be described as enabling an "à la carte" approach to cloud computing -- take what you need for as long as you need it, with no subscription or long-term obligation, no need to plan ahead.

Amazon.com Inc. (Nasdaq: AMZN), which runs the largest cloud service in the world, isn't presently interested in digital currencies; payments head Tom Taylor said in April the company has no immediate plans to "engage Bitcoin," CoinDesk says.

The only uses I can think of for this service are illegal. That's not necessarily a bad thing; illegal services include both malware (bad) and anonymous communications hidden from the prying eyes of dictatorships (good).

In other Bitcoin news, Dish Network LLC (Nasdaq: DISH) announced today it will start accepting Bitcoin payment. (See Dish Says Yes to Bitcoin.)

— Mitch Wagner, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profileFollow me on Facebook, West Coast Bureau Chief, Light Reading. Got a tip about SDN or NFV? Send it to [email protected]

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DHagar 6/5/2014 | 4:39:38 PM
Re: I wonder if this might not cover mturk payments someday @mhhf1ve, you are right.  That is a big market potential for them.  That sounds like the kind of tactical move they would make, too!

mhhf1ve 6/5/2014 | 4:24:14 PM
Re: I wonder if this might not cover mturk payments someday Digital payments not only competes with eBay, but also any other ecommerce site PLUS the banking industry. I'm not sure if this patent will help amazon carve out its niche in the digital payment market, but amazon should certainly be interested in the area.
DHagar 6/5/2014 | 2:19:49 PM
Re: I wonder if this might not cover mturk payments someday @Joe, I think you nailed it on the competitiveness with eBay.
DHagar 6/5/2014 | 2:18:14 PM
Re: Non-obviousness!!!!! @Joe, good points.  My bet is they will be miffed that Amazon patented it.

And, create a market for other digital payments, like mhhf1ve mentions as well.
Joe Stanganelli 6/5/2014 | 3:30:34 AM
Re: I wonder if this might cover mturk payments someday... @mhhf1ve: You know, the more I think about this, the more I think that this is Amazon trying to leverage digital currency for its own purposes in taking on PayPal and eBay.

Amazon has long competed with eBay quite directly, offering a variety of new and used goods from online sellers, and even offers online auctions -- just like eBay.  This could be yet another step toward making eBay less relevant.
Joe Stanganelli 6/5/2014 | 3:28:00 AM
Re: More flexible cloud computing @Kruz: Excellent point.  Expect Amazon to get way more law enforcement "requests" for information on users to determine if they are also Bitcoin/digital currency users.
Joe Stanganelli 6/5/2014 | 3:24:23 AM
Re: Non-obviousness??? @DHagar: Interesting thoughts.  It is, in this sense, good marketing and publicity.  What better way to announce to the world 1) you support Bitcoin and 2) you're ahead of your competitors on payment methods than by patenting it and letting the reporters go to town on it?

The question is: Will the die-hard Bitcoin/digital currency community hate Amazon because it's dared to patent this?  Or will they appreciate Amazon loudly giving their currency more legitimacy?
mhhf1ve 6/4/2014 | 6:48:28 PM
I wonder if this might cover mturk payments someday... Amazon's mechanical turk might also benefit from a digital cash payment system... 
DHagar 6/2/2014 | 12:31:01 PM
Re: Non-obviousness??? @Joe, good thoughts - I am wondering the same thing.

To your point on defensive patent, I am wondering if that isn't to open the door on new overall purchasing for Amazon products/services with digital cash and they see this as a door opener?
DHagar 6/2/2014 | 12:23:45 PM
Re: More Flexible Cloud Computing @Susan, you do what banking does.  You create a system of transparencies and limits on known illegal transactions.  Then you at least have a reasonable safety net to limit incentives for illegal behavior and/or exposure.
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