Posted on April 20th, 2011Amazon recently added a dedicated server option to their Elastic Compute Cloud (EC2) service which allows a single user to utilize dedicated hardware on a within a virtual private computing servers. Amazon released that this new service permits users take advantage of the on-demand elastic provision while paying for only the resources they use and have a private network to themselves.
The Dedicated Instance
This service is aptly named, “Dedicated Instance” and was introduced to a small number of customers. Customers are looking at a $10 per hour charge whenever a Dedicated Instance runs within a specific region. Competitors StrataScale and GoGrid recently announced a hybrid hosting solution and dedicated private cloud package. This indicates that the dedicated server technology is not new to this industry.
Last to the Party
It appears as if Amazon is the last major hosting company to the virtual private dedicated server hosting party. However, executives at Amazon do not feel this has hurt their business in the least. Instead, they noted it has not been a primary aspect of their business model. Therefore, by entering this market, the company already has a strong customer base who may be interested in switching.
Success with Non-Virtualization
On the other hand, companies like AT&T have made significant profits from non-virtualized business due to the physical-level security, flexibility of leasing versus buying and isolation. Therefore, this continues to be a legitimate business requirement for non-virtualization and physical isolation through co-location hosting.
The Amazon EC2 Model
Industry analyst recognize that Amazon EC2 is innovative as the service provides quick and inexpensive access to virtual images enabling website developers to retrieve resources when needed and not pay for those not used. The model is based on the “what you see is what you get” idea. Therefore, Amazon does not promise customers will use the same resource they began with or that consistent performance will always be available.
The GRC Requirement
The primary need for dedicated services among organizations is the governance, risk and compliance (GRC) requirement. Since the cost of dedicated services is reasonably low with Amazon’s monthly packages, customers may opt for dedicated services without the business necessity. This idea is built-in to Amazon’s EC2 business model.
Although not beginning as a web hosting provider, Amazon continues to improve their portfolio by offering customers what they want. Virtualization of dedicated servers is definitely a continually emerging type of web hosting.