Amazon Elastic Compute Cloud (Amazon EC2) is a web service that provides resizable compute capacity in the cloud. It is designed to make web-scale computing easier for developers. It is tightly coupled with Amazon Simple Storage Service (Amazon S3) that enables storage in the cloud. Amazon EC2 is under limited beta right now with the limitation of 20 running instances.
At first look, the new service is easily confused with traditional web/application hosting services. However, the key difference is the elasticity of capacity. Traditional hosting service has various plans for different hosting capacity. As the demand grows, you will always face the problem of migrating to higher capacity hosting. Amazon EC2 claims to solve the problem by offering elastic capacity hosting.
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