The true cost of cloud hosting

(written by lawrence krubner, however indented passages are often quotes). You can contact lawrence at:

From all I’ve seen, I think this is true: cloud hosting is often more expensive than a dedicated server, so the real benefit of cloud hosting is its reliability, not its cheapness.

I think it’s pretty well known that for most use cases, cloud hosting is more expensive than dedicated hardware.
That said, we’re currently moving from a dedicated server to AWS, after we had a bit of nasty downtime. We have dedicated servers with 1and1, and the RAID in our server died and striped bad data all over one of the disks, slashing half the files with junk. 1and1 tech support refused to acknowledge the problem (and claimed we had software RAID setup…) and it took us a few days to get back online from our weekly backups.
What I’m hoping from Amazon as a cloud provider is handling failure better: With 1and1, a failed machine means a few days getting a new one, or paying double for a hot spare. With Amazon, even if dead instances happen more often, killing it and spinning up a new one is trivial, and can even be automated. Backups can be made much more often non-intrusively by using snapshots.
For reliability’s sake I also like the idea of having a few small instances behind Elastic Load Balancer instead of one beefy machine. I haven’t seen anything like ELB with a dedicated hosting provider (aside from using an actual load balancer, which is a very expensive proposition).