To efficiently utilize their infrastructure and thus increase their revenue, cloud providers need mechanisms to provide resource allocation and performance isolation for different tenants in the shared platform. In particular, network bandwidth sharing is a critical yet still an open problem to most cloud providers. In this paper, we study the problem of virtual machine (VM) allocation under the consideration of providing bandwidth guarantees. We first propose an online allocation algorithm for tenants with homogeneous bandwidth demand, which improves on the accuracy of existing algorithms. Subsequently, we extend it to handle heterogeneous bandwidth demand. Extensive simulations show that our algorithm makes much more efficient utilization of the network resource than existing algorithms, and performs close to the optimal offline allocation.