[mcclung]

Even though amazon.com is all on EC2 and capacity is demand driven, someone is still buying servers and has some capacity overhead, right? They've just shifted the spend from the amazon.com business unit to the AWS business unit (assuming that's how it's set up)?

[onedognight]

You can flatten the demand easily with EC2 by having the cost vary dynamically based on overall load. So (using his example) during the end of November Amazon themselves would want more servers and so the cost could go up slightly. A drug company doing discovery might decide then not to run their computations and to wait until the price drops back down. Likewise with someone cracking passwords, or mining bitcoins.

[singlow]

They have consistent pricing year-round for their on-demand and reserve instances. The spot-instances are priced dynamically by auction and the supply of them would be reduced when Amazon is using more instances itself. The price of the spot instances will never exceed that of the on-demand rate, since no-one would bid greater than a fixed rate for the same service. At the peak usage, spot instances reach the same price as the on-demand rate.

[byoung2]

The price of the spot instances will never exceed that of the on-demand rate, since no-one would bid greater than a fixed rate for the same service

Checking the price history in the AWS console reveals that the prices for spot instances occasionally exceed the on-demand rate. In particular t1.micro instances reached $0.05/hr (vs the on-demand $0.02/hr). One possible explanation is that spot instances are more valuable because you can run more of them at a time than on-demand instances (100 total vs 20 total) without having to get an exemption for your use case. Another possible explanation is that people bid higher amounts to guarantee that their instances will run uninterrupted, knowing that even if the price briefly exceeds the on-demand price, the average should still be lower overall.

[doki_pen]

I don't know about "easily". If you take a higher level view, like the entire internet, then you will see that most sites have a similar usage pattern. How many have the opposite problem?

I guess as we move towards a more global economy it will level out somewhat on a day to day basis, but I don't know if that is a realistic expectation. The season spikes probably won't change.