Amazon.com wants to sell your organization a whole lot more than books, music and electronics. Amazon, the Seattle-based e-commerce giant, wants to rent your organization storage space for your mission-critical data and virtual machines for doing your information processing. The offerings are enterprise-quality, and the prices are astonishingly low. But is it safe to trust your business to Amazon's infrastructure?

These days it's common for businesses to host their websites and e-commerce systems at colocation facilities. And increasingly much of this equipment is outsourced as well. Although many businesses still like to buy their own servers, disk arrays, load balancers and firewalls, it's much more economical to rent a few dedicated servers at a service provider and let somebody else worry about the plumbing. ISPs get economies of scale by managing hundreds or thousands of identical machines, while the customer can concentrate on building a high-quality website.

Elastic computing

Amazon's new Elastic Compute Cloud (EC2) Web service takes this idea of hosted servers to a new level. Instead of renting physical servers on a month-by-month basis, Amazon is now renting virtual computers by the hour -- 10 cents an hour, to be exact. That 10 cents gets you the equivalent of a 1.7GHz Xenon processor with 1.25GB of RAM and 160GB of hard drives. Bandwidth is 250Mbps, at the cost of 20 cents per gigabyte transferred.

One reason that EC2 is so cheap is that the virtual servers can crash at any time and they aren't backed up. If you want to build a reliable system, you need to do it yourself by renting multiple servers and fashioning them into a redundant cluster. This approach provides not just redundancy but scalability. For example, you might build a little e-commerce website with two Web servers and two database engines. If you notice that your site is more popular on weekdays than on weekends, you might bring up an extra two or three servers on Mondays and shut them down on Friday afternoons. By forcing the customer to address the issue of backup and scaling directly, EC2 lowers costs for both Amazon and the customer alike.