Cloud Price Normalization – CPN Index
The CloudPriceCalculator uses a simple index to compare infrastructure as a service cloud computing offers. The Cloud Price Normalization (CPN) index adds compute, memory, storage, bandwidth, and divides by price. CPN reflects the quantity of cloud resources that one can buy for $1000 USD. The CPN table includes offers from six different vendors with CPN’s that range from a vincinity of 10 to 50. This 5x differential should start to narrow once price competition starts to take hold.
The CPN results for Amazon EC2 which vary from 13 (Standard Small) to 50 (XXXX Large High Memory) reflect the relative ages of the offers. Amazon EC2 introduced the original standard small offer in August 2006. The High Memory instances were introduced in October 2009 and benefit from 36 months of cost performance improvements. The question remains whether and when Amazon EC2 will feel inclinded to improve the value proposition of its standard small instance.
goCipher created a cloud offering matching several of the Amazon instances with at least double the CPN rating. Customers can obtain at least double the price performance value with these DomainGuru offers. CPN enables ranking any cloud offers in terms of relative value proposition. The CloudPriceCalculator home page shows six examples with a Softlayer instance on top and a GoGrid instance on the bottom. CPN makes it clear GoGrid needs offer significantly more for significantly less.
The CPN unwinds some of the confusion about total cost that arises from the many ala carte components of cloud offers. The cost of bandwidth tends to represent a significant monthly costs with vendors charging anywhere from $.12 per GB to $0.22. Most of the vendors charge only for outbound bandwidth, but Rackspace charges for inbound and outbound bandwidth. There exist a range of other ala carte charges for IP addresses or persistent storage that can effect costs. All the vendors charge extra for Windows support with Amazon EC2, for example, charging significantly more via a percentage calculation rather than a flat fee.
There exist plenty of dimensions for competition even given relatively similar CPN results. There are significant differences in the strength and cost of support offers. Amazon is among the most expensive with a $400 per month minimum and a 20% fee on top of total monthly costs for Gold Support. The basic reliability of cloud offers will vary significantly between cloud suppliers. No one seems to offer an SLA of better than 99.99% up time. The basic functionality of a cloud offer relative to commodity dedicated servers also represents a consideration. Not all applications work well in a virtualized environment. Amazon EC2, for example, tends to perform poorly relative to the real-time needs of VoIP applications.