James Hamilton posted a fairly robust model of how to think about this (and evaluate S3), just prior to joining Amazon. http://perspectives.mvdirona.com/2008/1

James Hamilton posted a fairly robust model of how to think about this (and evaluate S3), just prior to joining Amazon. http://perspectives.mvdirona.com/2008/12/22/TheCostOfBulkColdStorage.aspx http://perspectives.mvdirona.com/2008/12/22/TheCostOfBulkCol... His is a more datacenter-level view (considering $/GB, from the perspective of arbitrary GB), but builds a convincing case why S3 @ $0.18/GB is fair).