[marktangotango]

I wonder how pricing is determined for these offerings? Ie whats the driver for profitability?

My thinking is as follows: if I use a popular IAAS for servers to host customers node.js apps, and if I have instances with 15GB of ram, if I offer application instances that are allocated at most 256MB, then I can fit about 58 application instances on a server (allowing 500MB for the OS). At 6€ an instance (for the intro tier) that's 348€ a month

An EC2 M3.xlarge costs about $81 a month (3 year heavy reserved, amortizing one time payment over 36 months). Today that about 63€ a month. So they intend to make 290€ per server minus additional costs for mongodb hosting.

Does that jive with how you all figure these things?