Last November, I wrote a post with the title Amazon’s Jeff Bezos: Honey, I just shrunk the server hosting business. In that post, I did some simple math to show how a small business like the one I run with Doug Gold (Mass Events Labs, where we host two servers with a bigtime hosting service) can save some serious money if it can figure out how to move from a physical hosting service to an "elastic" one like Amazon's Elastic Compute Cloud (EC2). So, if a small business can save some serious money on two servers, can you imagine what a larger company with more servers can save. Unfortuantely, right now, it's not as simple as calling up Amazon and asking them to turn on two servers the way you'd do that with a hosting service. An EC2-based server gets launched through Amazon's web services APIs and, in the same way you can programmatically launch a server on the fly and provision it, you can de-commission it on the fly as well. Since EC2 is a pay as you go service, the advantage is that you only pay for the server capacity that you need. Unlike with a traditional hosting facility where, once you sign up for a couple of servers, you're probaby stuck with them for a year. So, given this dynamic server on demand model, EC2 represents another opportunity to save money than just the sheer cost. Anyway, I decided to do explain this concept through one of ZDNet's trademark whiteboard videos. Check it out.