I think the big deal about amazon is dependability, elasticity and the addon services for now. They are the 400 pound gorilla. I can order ten 1TB EBS volumes

I think the big deal about amazon is dependability, elasticity and the addon services for now. They are the 400 pound gorilla. I can order ten 1TB EBS volumes right now and they will deliver in a blink. I'm not sure if slicehost can do that, yet. They have CloudFront which lets me stop worrying about latency, even for overseas customers, at the flick of a button. They have DevPay, SimpleDB, SQS and such which I don't use but it's there should I need it. In terms of elasticity they truly let me pay for what I use. At slice I have to commit upfront to traffic and diskspace. Yes, up- and downgrading slices is possible but it's not nearly as seamless as with amazon - where you just do nothing. For now I think the amazon markup is still justified. But you are right, if the gap widens too much then they'll start losing customers.