22 Copyright © 2014, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited. Chapter 2 ABSTRACT This chapter addresses a set of optimization problems that arise in cloud computing regarding the location and resource allocation of the cloud computing entities: the data centers, servers, software components, and virtual machines. The ﬁrst problem is the location of new data centers and the selection of current ones since those decisions have a major impact on the network eﬃciency, energy consumption, Capital Expenditures (CAPEX), Operational Expenditures (OPEX), and pollution. The chapter also addresses the Virtual Machine Placement Problem: which server should host which virtual machine. The number of servers used, the cost, and energy consumption depend strongly on those decisions. Network traﬃc between VMs and users, and between VMs themselves, is also an important factor in the Virtual Machine Placement Problem. The third problem presented in this chapter is the dynamic provisioning of VMs to clusters, or auto scaling, to minimize the cost and energy consumption while satisfying the Service Level Agreements (SLAs). This important feature of cloud computing requires predictive models that precisely anticipate workload dimensions. For each problem, the authors describe and analyze models that have been proposed in the literature and in the industry, explain advantages and disadvantages, and present challenging future research directions. Location and Provisioning Problems in Cloud Computing Networks Federico Larumbe Polytechnique Montreal, Canada Brunilde Sansò Polytechnique Montreal, Canada DOI: 10.4018/978-1-4666-4522-6.ch002