Roundup: Amazon Reserved Instances

Will Amazon's capacity be there when you need it? This is a key question, since Amazon is touting the feature for disaster recovery. Craig Balding at Cloud Security looked at the fine print in the AWS Reserved Instances agreement, and found that Amazon says it "may terminate the Reserved Instance Pricing program at any time." "If you want to use AWS for Disaster Recovery, you better have a plan B as Amazon will only give you 60 days notice if they decide to drop Reserved Instances," Craig writes.

Reuven Cohen at Elastic Vapor believes Amazon is using Reserved Instances to target a new market. "They are going after the web hosting space," Reuven writes. The new pricing may offer easier comparisons with traditional web hosting plans, but the missing link is e-mail services, which are an essential component of most small business hosting plans. I don't believe it's currently feasible to run e-mail servers atop AWS, although spammers have tried, leading many hosts to block email from AWS. One workaround would be to split off e-mail services onto Gmail, a strategy being encouraged by some large hosting providers. The hosting ecosystem relies heavily upon resellers and affiliate referrals to route business to major players. But it remains to be seen whether many hosting resellers have the technical skills to operate atop AWS, and although Amazon has an active affiliate program, it seems unlikely to match the $100 referral fees offered by major shared hosting companies.

Amazon EC2 may not be a feature-for-feature replacement for web hosting accounts, but its pricing model is evolving to enable better ROI comparisons with hosting companies and data center providers. Geva Perry has put together an Amazon Reserved Instances Savings Calculator that looks at some of the math.