Amazon gives away freebie baby virty data centres

Retailing giant and utility computing pioneer Amazon is betting that virtual servers, storage, and networking capacity are like potato chips: you can't just have one. Perhaps Amazon Web Services hopes that users will get hooked on cloudy infrastructure and won't be able to get off. At any rate, starting on 1 November, Amazon is going to give away free instances to its utility services to anyone who signs up.

Amazon has been dabbling in this free concept for the past four years, and this past August announced its fourth annual startup challenge to find companies with under $10m in revenues or venture funding that are doing interesting things with the EC2 compute clouds and related S3 and EBS storage utilities.

The idea is to promote the EC2-S3-EBS triple play as the default platform for startups - much as the double-whammy of Sun Microsystems hardware and Solaris plus Oracle databases were the default platform during the dot-com boom. Entries for the startup challenge, which you can find out more about here, have to be in by 31 October, and six global finalists will get $10,000 in credits for AWS products and lots of media coverage that will help them land venture funding and get their businesses climbing to the stratosphere.

With the one-year free usage tier programme, which you can read about here, everybody and anybody is a winner just by creating an AWS account and being a newbie to AWS. Under the deal, you get an Elastic Compute Cloud (EC2) micro instance running Linux with 613 MB of main memory and support for 32-bit or 64-bit applications for 750 hours per month for free.

The micro instance of EC2 does not have a dedicated amount of EC2 Compute Units (ECUs), but has a tiny and unspecified base amount that can burst up to two ECUs in burst mode when needed. Any EC2 is somewhere around 1 GHz to 1.2 GHz of processing capacity that an Opteron or Xeon processor from way back in 2007 can do. This instance normally costs 2 cents per hour, or about $15 a month, under on-demand licensing terms, and $54 plus seven-tenths of a cent per hour if you reserve it for a whole year. That works out to $117 for a year, which works out to a 35 per cent discount.

When is the last time Amazon gave you $117 instead of the other way around? But the value is higher than that, because to this micro virtual Linux server, Amazon tosses in 750 hours per month of its Elastic Load Balancer plus 15 GB of data processing capacity to link it to the outside Internet world, and then adds 5 GB of Simple Server Storage (S3) capacity with 20,000 get requests and 2,000 put requests and 10 GB of Elastics Block Storage (EBS) capacity with 1 million I/O operations, 1 GB of snapshot storage, 10,000 snapshot get requests, and 1,000 snapshot put requests. The freebie deal includes 15 GB each of data transfer into and out of all of the AWS services not counting the CloudFront content delivery and streaming service. The freebie stack includes 25 machine hours of the SimpleDB database service; 100,000 requests on the Simple Queue Service; and 100,000 requests, 100,000 HTTP notifications, and 1,000 email notifications from the Simple Notification Service. SimpleDB, SQS, and SNS are already free indefinitely, so this is not really a new deal.

Suffice it to say, Amazon is betting that by giving away hundreds of dollars per year in services to moochers it can convert them to paying customers. It is the same bet that every open source company makes with software, so why not with virtual hardware?

If the applications you use go over the capacity limits established under the free tier programme, you are liable for the utility fees for the capacity you burn. So pay attention to the AWS Management Console or you may get burned. (Just use your book money. It will be a wash.)

Amazon says that it can withdraw the free usage tier programme at any time, and if it is successful, it may do that right quick. You need to give Amazon a valid credit card to play. ®