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Amazon Strikes Back With Lower Cost Instances
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Laurianne
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Laurianne,
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7/2/2014 | 10:38:20 AM
Bursty cloud instances
These "bursty" cloud instances speak to one of the innate, early appeals of cloud: More compute power when you want it, on demand. Few companies have achieved this mode of cloud operation in reality though. Interesting that the dev crowd's interest in Digital Ocean is registering with Amazon.
Charlie Babcock
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Charlie Babcock,
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7/2/2014 | 1:11:33 PM
Rackspace original leader in "bursty" CPUs
I always liked the fact that Rackspace didn't hold back. If you were a customer and your application needed more CPU cycles, Rackspace would give them to you, if all they were doing was idling away. This isn't well known nor is it easy to market, since extra cycles may not be available when you want them. But it follows a line of thought that it's always best to make maximum use of the resource -- it's consuming electricity anyway -- in useful work than in rationing it strictly based on price. It's a cloud-like concept.
Laurianne
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Laurianne,
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7/3/2014 | 12:30:36 PM
Re: Rackspace original leader in "bursty" CPUs
Interesting context Charlie. Now will Rackspace go private? Hmmm.
Brian.Dean
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Brian.Dean,
User Rank: Ninja
7/3/2014 | 10:07:21 PM
Re: Rackspace original leader in "bursty" CPUs
These prices are great, considering that the average PC consumes between 60 to 260watts of energy, if we take the upper limit and 1 Kw/h of electricity cost at around $0.10, the PC would be costing 2.6 cents to operate in electricity charges in an hour. PCs are one of the most efficient devices in businesses and houses, when compared to other devices and appliances.

I think IaaS prices would have a certain level of elasticity with the cost of power, and a Cloud provider with a good PUE score (Power usage effectiveness) would be able to offer lower prices. However, Moore's law is an important consideration as well.
Joe Stanganelli
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Joe Stanganelli,
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7/4/2014 | 4:48:36 AM
Re: Rackspace original leader in "bursty" CPUs
>  PCs are one of the most efficient devices in businesses and houses, when compared to other devices and appliances.

Depends on how you look at it.  Is keeping my food refrigerated and my dishes clean a more or less efficient use of resources -- and by how much -- than keeping me entertained with cat pictures and YouTube videos?  ;)

That said, the American cloud providers are absolutely going to battle with each other over prices right now -- especially as others begin to catch up to Amazon and in the wake of the Snowden revelations costing American cloud companies business.
Brian.Dean
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Brian.Dean,
User Rank: Ninja
7/4/2014 | 9:21:17 PM
Re: Rackspace original leader in "bursty" CPUs
@Joe, good point, it all depends on resource allocation. Here is a scenario that I hope plays out in the real world, a consumer is watching a cat video when they suddenly notice an inverter based air conditioning unit in the video, next the consumer begins researching the unit and discovers that they could be saving 50% on their energy bill -- lets include LED lighting and front loader washing machines into the video and if we are imaginative, then we can attribute the billions of dollars saved in power usage to the PC and Cloud.

Cloud providers have absolutely suffered a great deal due to Snowden's revelations -- it gave overseas players an artificial advantage. Looking at the positive side, I feel, it has made the local providers much more competitive in terms of price, and with time, business confidences could be restored.
Joe Stanganelli
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Joe Stanganelli,
User Rank: Ninja
7/5/2014 | 1:51:48 AM
Re: Rackspace original leader in "bursty" CPUs
@Brian: There have certainly been developments with shopping via Internet video, but the tech developments there seem to have stalled over the past few years.

As far as the cloud stuff goes, I'm reminded of this bit of dialogue from the 1985 film Clue:


> Why is J. Edgar Hoover on your telephone?


> I don't know; he's on everyone else's!  Why shouldn't he be on mine?

danielcawrey
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danielcawrey,
User Rank: Ninja
7/5/2014 | 5:00:32 PM
Re: Bursty cloud instances
I havce never heard of Digital Ocean before this post - but it is obvious that although they must be tiny in comparison to Amazon, it must be a direct threat if costs are being lowered. 

Amazon can compete with price if it wants to in this space - it does this in other areas it does business in - so hopefully Digital Ocean has some key differentiators to help it compete. 
Li Tan
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Li Tan,
User Rank: Ninja
7/5/2014 | 10:12:38 PM
Re: Bursty cloud instances
There is no doubt that Amazon can further compete in the aspect of price. So the other game player needs to have some mitigations in hand. In other words, they must offer something unique compared  to AWS/EC2 to win the market share.
Charlie Babcock
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Charlie Babcock,
User Rank: Author
7/8/2014 | 1:04:26 PM
Amazon and the dwarfs
Of  course Amazon backs up basic cloud servers with reputation, operational experience and a long list of related services that become valuable if you're doing more than software development. Competition in the cloud is about more than just price. It's about kind of operational environment can you create and sustain.
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