I don't think most people really grasp the meaning of Amazon's EC2 service.

Basically Amazon is now the cheapest high-quality dedicated hosting provider in the world. And they offer provisioning functionality no one else can match.

Amazon EC2 - "Elastic Cloud" allows you to run as many Linux boxes as you like. They charge you $0.10 per CPU hour. It gives new meaning to the expression: It's your dime

This equates to $72/month for a server. In comparison, up til now, I've considered $99/month a pretty good deal for a dedicated server.

I'm using the EC2 beta, and created my first machine. I notice using dmesg on my instance that Amazon is running EC2 on top of Xen virtualization:

BIOS-provided physical RAM map:
 Xen: 0000000000000000 - 000000006a400000 (usable)
980MB HIGHMEM available.
727MB LOWMEM available.

What makes this unique:

• Amazon is making this very cheap.
• They are running a mainframe of virtual x86 machines.
• You can bring up a bunch of them on-demand.
• Amazon provides supporting services and APIs (Storage, Queueing, etc.)
• It's Amazon.

Who suffers the most from this little revolution? I think it could be VCs. Software and services entrepreneurs simply won't need as much money to create the next Digg, Flickr, or even Google.

¶ 9/18/2006