Cloud Computing Trends

Is Amazon's Cloud Cheaper? The Debate Continues

Is shifting your applications to Amazon Web Services' cloud computing platform cheaper than running them in your own data center? A new estimate of the costs of cloud vs. hosted has prompted discussion of cloud economics.

Is shifting your applications to Amazon Web Services' cloud computing platform cheaper than running them in your own data center? The answer usually depends upon the application and its requirements. Given the many debates about the pros and cons of cloud adoption, many potential users take a hard look at the economics.

In a column  at GigaOm, Charlie Oppenheimerof Matrix Partners runs the numbers for using AWS versus in-house infrastructure. "In most cases, the analysis illustrates why intuition is right (for example, that a highly variable compute load is a slam dunk for AWS). In other cases, certain high-sensitivity factors become evident and drive the economic answer. There are also cases where a hybrid infrastructure is at least worthy of consideration."

That prompted a response from AWS blogger Jeff Barr, who said some of Oppenheimer's assumptions skewed the analysis. "These analyses are always tricky to do and you always need to make apples-to-apples cost comparisons and the benefits associated with each approach," said Barr. "We're always happy to work with those wanting to get into the details of these analyses; we continue to focus on lowering infrastructure costs and we're far from being done."

The discussion echoes a similar debate in 2010, when networking executive Vijay Gill (then at Google) shared calculations suggesting colocation could be significantly cheaper than Amazon.  These discussions are unlikely to settle the issue, but provide useful data points for companies analyzing the most cost-effective way to deploy growing infrastructures.

Photo by el diablo robotico (Jeffrey Bell) via Flickr.

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