There are two ways to purchase bandwidth in a Merkato system.
The first method is called the Reservation market and uses a Reservation agent. The second method is called the Spot market and uses a Spot agent.
Reservations eliminate uncertainty. You know how much bandwidth you will be receiving, for what duration, and for what price.
In the Spot market, distribution of bandwidth is based on ranking bidders by price offered. It is possible that for some period of time you will be unable to obtain the full amount of bandwidth you desire because you are out-bid by other buyers.
The Spot market provides true bandwidth-on-demand. The changes you make to the way your agent bids take effect in five to ten minutes. You can even stop bidding entirely for a period.
Reservations may be cancelled, but the seller may have a cancellation fee.
The Seller sets the Reservation market prices. Spot market prices are determined by a unique progressive second price bidding process. You do not necessarily pay what you offer; you pay the unit price of the lowest bidder to be awarded bandwidth. This is the true “market price” for the bandwidth offered by the seller, as established by the community of active buyers. (See “Merkato Auction Mechanism: The Progressive Second Price Auction.”)
You need not choose one or the other purchasing option exclusively. Any bandwidth you purchase on the Spot market will be added to bandwidth you purchase on the Reservation market. Many buyers use the Reservation market to “lock in” their minimum required bandwidth, and then use the Spot market to purchase additional bandwidth as required.
Depending on how your administrator has set up your Merkato system, you may have separate login usernames for each type of agent or they may share a common username and password. (If different agents share the same username, you have to obtain them from different “Garages.”) Ask your Merkato administrator for details.