Is AWS More Economical Than Traditional Data Centers?
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Charlie Johnson
Length: 6 mins
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Is AWS More Economical Than Traditional Data Centers?

Hosting costs money, the direct benefit is not tangible and in the worst case it causes problems. Yet hosting is the foundation for the success of web projects. For applications with varying compute workloads, AWS is more economical than traditional data centers, due to its scalability and competitive pricing offer. Outsourcing the cloud management comes with many advantages

You pay for what you need. Do you need more server capacity for Christmas sales, a campaign or a major event? Then you book it on a daily basis, and optimize the cost. Such flexibility can be provided by one of the best known Amazon’s services, namely EC2 (Elastic Compute Cloud), which we will look at in more detail.

So, without further ado, let’s dive in.

What is EC2?

Amazon Elastic Compute Cloud (Amazon EC2 provides scalable computing capacity in the Amazon Web Services (AWS) Cloud. Using Amazon EC2 gets rid of the need to invest in hardware in advance, so applications can be developed and deployed quicker.

You can use Amazon EC2 to launch as many virtual servers as you need, configure security and networking, and manage storage. Amazon EC2 makes it possible to scale up or down to manage changes in requirements or spikes in popularity, reducing your need to forecast traffic.

Why will using Amazon EC2 be more cost effective than traditional data center storage models?

  • Amazon Elastic Compute Cloud costs are billed on a monthly basis.
    Amazon EC2 usage is calculated by either the hour or the second based on the size of the instance. Pricing is per instance-hour consumed for each instance, from the time an instance is launched until it’s terminated or stopped, so you pay just for the cloud space that you’ve used.
  • Amazon EC2 instances can be launched on-demand when needed.
    Customers can permanently run enough instances to handle peak workloads, as well as reduce them according to their needs.

Is EC2 always the best option?

EC2 is targeted mainly towards larger businesses. If you want to host a small application or a website you might consider using AWS Lightsail. Lightsail is beginner friendly and designed for speed and simplicity. Amazon Lightsail costs are lower for basic resource usage compared to the On-Demand Instances in EC2. The instances run on top of EC2 and are bundled with other AWS resources, though those services are abstracted so it’s not visible to the user. The Lightsail service allows users to provision pre-configured cloud servers like LAMP, WordPress, Node.js, or Magento to quickly set up the application architecture without having to install the software manually.

When is running a data center better than using cloud computing?

In most cases, choosing a cloud services provider is the way to go. There are, nonetheless,  some cases when companies might choose a traditional data center. It is for example, when you need a whole datacenter and have high utilization. Let’s say, when a company deploys multi-cloud architecture.  It’s because resource utilization and cost monitoring is more difficult in a multi-cloud architecture, as there is no unified data representation, so organizations should track costs in different places. Total visibility is a must in this situation. Nowadays though, companies offer tools which provide a high level of visibility. Another case is when you are yourself a cloud computing provider. Nowadays, however, most companies, even the biggest players like Netflix, Facebook or NASA, are using AWS or other cloud services. 

Cloud hosting alternatives from another companies

Amazon, providing services tailored for user needs, whether it is a small business or a huge enterprise, it remains the most popular cloud services provider on the market, and it’s always will be a stable and reliable choice. There are, however, other companies that might fit your needs better. I will present a list of a few other companies with a quick overview, and their pros and cons compared to AWS. 

  • Google Cloud
    along with AWS and Microsoft Azure belongs to the 3 leading companies providing cloud services on the market. AWS provides lots of training and certification options, and you can get enough materials to ramp up on the technology. On the contrary, Google has limited options for certification and training, so finding a GCP certified associate is truly difficult for an organization. Google Cloud has less offerings and it’s limiting you to older and fewer technologies. In essence it’s like you’re trading convenience for power. It might be a better choice though when your biggest concern is performance. 
  • Microsoft Azure
    is better suited for larger businesses that need more flexibility and scalability. It can support larger numbers of simultaneous users and can handle more complex applications and services than AWS. On the other hand, AWS is better suited for small to medium-sized businesses that need convenience and user-friendliness. It is quite affordable, offers easy access to resources, and integrates well with other tools and platforms. Both platforms have their own strengths and weaknesses.
  • Digital Ocean
    service is much more straightforward, you know exactly what you are going to pay at the end of the month. No hidden charges whatsoever. The complexity of AWS isn’t always a good thing. AWS, however, is a better pick for products with a  fairly complicated backend architecture. For a small agency though, the better choice overall might be Digital Ocean.
  • Linode
    will likely almost always work out to be less expensive. However, Amazon offers various scalability advantages. It really depends on what you are trying to do, but, for the average user, looking for a few VMs and needing some day to day support, you will almost always be better off with a more boutique shop like Linode.

Final thoughts

Cloud computing adoption is on the rise every year, and it doesn’t take long to see why. Traditional data centers are becoming a thing of the past. Enterprises and small businesses recognize cloud computing benefits and see how they impact their production, security and revenue

By using a cloud-based solution, a company can prevent a lot of problems that influx organizations that rely on on-premises infrastructure.

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