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How Amazon Won the On-Demand Hosting Game (And What You Can Do to Catch Up)

1.Robin Miller was telling me about his new video production service. It started as an experiment; now it's taken off as a business. The challenge is, which should he put the videos he's produced? Free hosting services don't offer high-enough-quality encoding, shared hosting isn't reliable enough, and he certainly doesn't need a whole dedicated server. The solution that came to mind was Amazon's S3. Since most of his mini-commercials are unlikely to be viewed by very large audiences, pay per use makes sense - even if Amazon's $0.20 per GB data transfer is about 100x more expensive than some shared hosting plans.

2. The folks at Dr. Dobb's wrote a long article about using Amazon EC2 in conjunction with Oracle SOA Suite 10g. (It's a set of standards-based components for developing reusable, interconnecting enterprise software modules.) They found EC2 to be "an ideal hosting environment for commodity SOA components". It ushers in "a new era in which reliable, resilient, scalable and high performance SOA deployments can live outside corporate boundaries."

3. Stephen O'Grady from Red Monk, an analyst firm, says Amazon is his pick for 2006's top technical innovator. Amazon "addresses a sizable and growing market" - and what it's doing is "a big deal". It levels the playing field for web app start-ups:

"Many of them are very, very good... but networking, hardware, etc require capital investments that can be onerous, and it's a simple fact that they don't benefit from Google's or Yahoo's economy of scale. They buy hardware piecemeal, and get run of the mill bandwidth deals, all of which adds up to high entry costs."

But Amazon, Stephen says, changes the game completely. And we've only seen the very tip of its iceberg - the more you use it, the more you'll figure out new ways to use it. Maybe tomorrow's departmental servers will be Amazon powered!

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I know - it just doesn't seem fair. After all, S3 was down last week, while your service probably wasn't. Nonetheless, Amazon has firmly positioned itself as *THE* on-demand hosting solution in the minds of these and other thought leaders - by offering many, many, many use cases. With ongoing updates. In fact, let's set expert opinions aside. Even my friends who know next to nothing about hosting have heard that Smugmug saved $500,000 with S3 and thinks Amazon is the Holy Grail.

In contrast, after talking to Robin, I spent some time trying to think of specific scenarios for which I would without a doubt recommend one particular hosting provider over any other competitor.

Rackspace was on my list, of course. That's where you go when you have a sizable budget and want great support.

Delaware.net is another good example, with its home grown SaaS apps.

And Softlayer's gigabit backend network is great for private server-to-server connectivity. A few months ago, CEO Lance Crosby told me about a company who put all of its franchisers on Softlayer servers and had them communicate with each other and corporate through Softlayer's LAN. See? Case studies really work. Like the Smugmug legend, that example has really stuck in my mind.

Can you think of any other hosting companies that have specifically and uniquely captured any particular "can't get it elsewhere" concept? If you feel your company belongs in this category, maybe you should flood the world with a bunch of success stories.

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