No, not really. Possibly this depends on where you are at but here in Portugal (where I am), I can get a better physical server for about 80Eur/month, which is

No, not really. Possibly this depends on where you are at but here in Portugal (where I am), I can get a better physical server for about 80Eur/month, which is only a bit more for what I would pay for an EC2 instance (including network traffic). Is it worth the extra dollars? I think so. Also, even though S3 doubles as a backup medium (and you _must_ backup your database), if you want a database running on EC2 you _must_ go for S3 to store your information. That too will increase your costs. And on top of all that, you have to spend some time tweaking and testing your configuration (and testing again). If you're short on working hands, the time you spend on this activity may not be worth it. I think that, unless you're doing it just for fun, you should let someone else help Amazon sort out the kinks of their system. In the end, having your entire system on EC2 will not give you an edge over your competition, but the time you save by not doing it probably will.