EC2 extends Amazon's S3 with pay-per-use server

TechCrunch has the scoop on Amazon's extension to its S3 storage-in-the-cloud service. According to Nik Cubrilovic's post, the new service--called EC2--will let users access compute capacity by setting up virtual server instances hosted by Amazon. Pricing for the server usage is 10 cents per instance hour, and then the S3 services pricing--20 cents per GB transferred and 15 cents per GB of storage.

Unlike Sun's utility computing, EC2 will provide only fixed capacity per instance, so the ability to scale compute capacity based on demand is limited--which makes EC2 more appropriate for less compute-intensive applications. According to the information below, compute capacity can be scaled up or down as needs change, similar to Sun's $1 per CPU hour service. More to come when I talk to Amazon later today....

Here's the detail from Amazon's site:

Amazon Elastic Compute Cloud (Amazon EC2) - Limited Beta
Amazon Elastic Compute Cloud (Amazon EC2) is a web service that provides resizable compute capacity in the cloud. It is designed to make web-scale computing easier for developers.
Just as Amazon Simple Storage Service (Amazon S3) enables storage in the cloud, Amazon EC2 enables "compute" in the cloud. Amazon EC2's simple web service interface allows you to obtain and configure capacity with minimal friction. It provides you with complete control of your computing resources and lets you run on Amazon's proven computing environment. Amazon EC2 reduces the time required to obtain and boot new server instances to minutes, allowing you to quickly scale capacity, both up and down, as your computing requirements change. Amazon EC2 changes the economics of computing by allowing you to pay only for capacity that you actually use.
Amazon EC2 Functionality
Amazon EC2 presents a true virtual computing environment, allowing you to use web service interfaces to requisition machines for use, load them with your custom application environment, manage your network's access permissions, and run your image using as many or few systems as you desire.
To use Amazon EC2, you simply:
    * Create an Amazon Machine Image (AMI) containing your applications, libraries, data and associated configuration settings. Or use our pre-configured, templated images to get up and running immediately.
    * Upload the AMI into Amazon S3. Amazon EC2 provides tools that make storing the AMI simple. Amazon S3 provides a safe, reliable and fast repository to store your images.
    * Use Amazon EC2 web service to configure security and network access.
    * Use Amazon EC2 web service to start, terminate, and monitor as many instances of your AMI as needed.
    * Pay for the instance hours and bandwidth that you actually consume.
Service Highlights
    * Elastic
      Amazon EC2 enables you to increase or decrease capacity within minutes, not hours or days. You can commission one, hundreds or even thousands of server instances simultaneously. Of course, because this is all controlled with web service APIs, your application can automatically scale itself up and down depending on its needs.
    * Completely Controlled
      You have complete control of your instances. You have root access to each one, and you can interact with them as you would any machine. Each instance predictably provides the equivalent of a system with a 1.7Ghz Xeon CPU, 1.75GB of RAM, 160GB of local disk, and 250Mb/s of network bandwidth.
    * Designed for use with Amazon S3
      Amazon EC2 works in conjunction with Amazon Simple Storage Service (Amazon S3) to provide a combined solution for computing and storage across a wide range of applications.
    * Reliable
      Amazon EC2 offers a highly reliable environment where replacement instances can be rapidly and reliably commissioned. The service runs within Amazon's proven network infrastructure and datacenters.
    * Secure
      Amazon EC2 provides web service interfaces to control network security. You define groups of instances and their desired accessibility.
    * Inexpensive
      Amazon EC2 passes on to you the financial benefits of Amazon's scale. You pay a very low rate for the compute capacity you actually consume. Compare this with the significant up-front expenditures traditionally required to purchase and maintain hardware, either in-house or hosted. This frees you from many of the complexities of capacity planning, transforms what are commonly large fixed costs into much smaller variable costs, and removes the need to over-buy "safety net" capacity to handle periodic traffic spikes.
Pricing
    * Pay only for what you use.
    * $0.10 per instance-hour consumed (or part of an hour consumed).
    * $0.20 per GB of data transferred outside of Amazon (i.e., Internet traffic).
    * $0.15 per GB-Month of Amazon S3 storage used for your images (charged by Amazon S3).
Data transferred within the Amazon EC2 environment, or between Amazon EC2 and Amazon S3, is free of charge (i.e., $0.00 per GB).
Amazon S3 usage is billed separately from Amazon EC2; charges for each service will be billed at the end of the month.