What is Amazon EC2 and what does it do?

An EC2 instance is a virtual server in Amazon’s Elastic Compute Cloud (EC2) for running applications on the Amazon Web Services (AWS) infrastructure. AWS is a comprehensive, evolving cloud computing platform; EC2 is a service that allows business subscribers to run application programs in the computing environment.

Amazon EC2 provides a wide selection of instance types optimised to fit different use cases. Instance types comprise varying combinations of CPU, memory, storage, and networking capacity and give you the flexibility to choose the appropriate mix of resources for your applications. Each instance type includes one or more instance sizes, allowing you to scale your resources to the requirements of your target workload.

With Amazon EC2’s simple web service interface allows you to obtain and configure capacity with minimal friction. It provides you with complete control of your computing resources and lets you run on Amazon’s cloud computing environment. Amazon EC2 reduces the time required to obtain and boot new server instances to minutes, allowing you to quickly scale capacity, both up and down, as your computing requirements change. Amazon EC2 changes the economics of computing by allowing you to pay only for capacity that you actually use. Amazon EC2 provides developers the tools to build failure resilient applications and isolate them from common failure scenarios.

Amazon EC2 is free to try. There are four ways to pay for Amazon EC2 instances: On-Demand, Reserved Instances, and Spot Instances. You can also pay for Dedicated Hosts which provide you with EC2 instance capacity on physical servers dedicated for your use.

On-Demand

With On-Demand instances, you pay for compute capacity by per hour or per second depending on which instances you run. No longer-term commitments or upfront payments are needed. You can increase or decrease your compute capacity depending on the demands of your application and only pay the specified per hourly rates for the instance you use.

On-Demand instances are recommended for:

  • Users that prefer the low cost and flexibility of Amazon EC2 without any up-front payment or long-term commitment
  • Applications with short-term, spiky, or unpredictable workloads that cannot be interrupted
  • Applications being developed or tested on Amazon EC2 for the first time

Spot instances

Amazon EC2 Spot instances allow you to request spare Amazon EC2 computing capacity for up to 90% off the On-Demand price.

Spot instances are recommended for:

  • Applications that have flexible start and end times
  • Applications that are only feasible at very low compute prices
  • Users with urgent computing needs for large amounts of additional capacity

Reserved Instances

Reserved Instances provide you with a significant discount (up to 75%) compared to On-Demand instance pricing. In addition, when Reserved Instances are assigned to a specific Availability Zone, they provide a capacity reservation, giving you additional confidence in your ability to launch instances when you need them.

For applications that have steady state or predictable usage, Reserved Instances can provide significant savings compared to using On-Demand instances.

Reserved Instances are recommended for:

  • Applications with steady state usage
  • Applications that may require reserved capacity
  • Customers that can commit to using EC2 over a 1 or 3 year term to reduce their total computing costs

Dedicated Hosts

A Dedicated Host is a physical EC2 server dedicated for your use. Dedicated Hosts can help you reduce costs by allowing you to use your existing server-bound software licenses, including Windows Server, SQL Server, and SUSE Linux Enterprise Server (subject to your license terms), and can also help you meet compliance requirements.

Per Second Billing

With per-second billing, you pay for only what you use. It takes cost of unused minutes and seconds in an hour off of the bill, so you can focus on improving your applications instead of maximising usage to the hour. Especially, if you manage instances running for irregular periods of time, such as dev/testing, data processing, analytics, batch processing and gaming applications, can benefit.

EC2 usage are billed on one second increments, with a minimum of 60 seconds. Similarly, provisioned storage for EBS volumes will be billed per-second increments, with a 60 second minimum. Per-second billing is available for instances launched in:

  • On-Demand, Reserved and Spot forms
  • All regions and Availability Zones
  • Amazon Linux and Ubuntu