Will Reasonably Smart be cheaper than EC2?

In response to James's post Ning shuts down WidgetLaboratory, Chris Holland asked if the Reasonably Smart Platform (RSP) would be cheaper than Amazon's EC2. It's a valid question that deserved its own blog post as a response.

So, will RSP be cheaper than EC2? The short answer is maybe.

The long answer needs to be looked at from a couple different angles.

1. Should the pricing of the two companies even be compared given the businesses they are in?
2. If they are in the same business will Reasonably Smart be cheaper than EC2?

In their own words, Amazon, through EC2, delivers a true virtual computing environment, allowing you to use web service interfaces to requisition machines for use, load them with your custom application environment, manage your network's access permissions, and run your image using as many or few systems as you desire.

In other words, they let you rent servers and bandwidth in shorter time frames then what was available from traditional hosting companies. Plus they make it "easy" to increase and/or decrease the number of machines you are renting quickly.

In our words, Reasonably Smart's mission is to develop and manage the open source Platform-as-a-Service that enables web application development in a Peer-to-Peer cloud/utility computing environment and empowers collaborative, efficient, industry transforming web application creation.

In other words, we provide an environment for you to develop and execute web applications.

The major differences between the two being that on our platform you can develop your web application without concerning yourself with:

• Creating, managing and scaling a database
• Creating back-up routines and load balancing between servers
• Developing an execution environment
• Managing security patches
• Hiring and managing system administrators
• Engaging (and paying) cloud computing management system providers
• Figuring out how to be "at the edges of the network"

A couple of other pieces of added value within the RSP platform over and above EC2 are the integrated distributed version control and the core philosophy of open source.

So the first answer to the question "will RSP be cheaper than EC2?" is that they are difficult to compare because there is much more value being provided by RSP than EC2.

Now, if you completely discount the Platform as a Service (PaaS) value proposition then the question of who will be cheaper comes down to the vision of the two companies for the (hardware) cloud.

Amazon has huge buying power, and can reach economies of scale that are difficult for others to attain. However, the RSP has been designed to be completely hardware-provider agnostic. Therefore, our hardware layer options could include EC2, IBM, Dell, EMC, any hosting company, our own datacentre, the server under your desk or all of the above. This makes the answer to the question most easily broken down like this:

1. If RSP utilizes EC2 as its hardware layer then RSP will not be cheaper than EC2
2. If RSP utilizes several data centres (EC2, EMC, IBM, Opsource) then RSP might be cheaper than EC2
3. If RSP reaches its "blue sky vision" of leveraging the world's excess server capacity then it is likely that RSP will be cheaper than EC2

Fundementally we believe that someone needs to start identifying the difference between a hosting provider and a cloud computing environment in light of all of the misrepresentation in the market and media. What Amazon are doing with EC2 is fantastic, and makes renting computing power more straightforward than ever before. They are, undoubtedly taking away the need to plug in server, and wire it up to the network. But don't forget, there is a difference between being in the cloud and being the cloud.

Hopefully this addresses both the question about who will be cheaper and starts to illustrate more clearly some of the differences between ourselves, and other "cloud" computing companies.