> Is it the norm for CPU to be a bigger line item than transfer?

Not universal, but certainly very normal.

1. Transfer within a data center is usually free.

2. CDN reduce transfer fees significantly for static content.

3. Transfer is pay-what-you-use, whereas compute is traditionally pay-what-you-reserve.

AWS transfer are $0/GB incoming; $0.09/GB outgoing. A c5.large (1 physical CPU, 4GB RAM) is $0.09/hour.

So as long as you average less than 291KB/s from your single-core machine, you will spend more on compute than transfer.

Considering that you probably overprovision the CPU to handle spikiness, this is quite likely especially for a typical JSON API server (no images, no video, no web assets).

I think most customers' biggest spend is on EC2, which is compute. Certainly this has been my experience.

This depends entirely on what your instances are doing. For ardour.org (AWS), we're running a simple PHP/Drupal/Discourse/Mantis web service. Since it's up 24/7 (it's a WEB SERVER!), we have a reserved instance which saves a fair amount on the CPU/compute cost. But even without this saving, data transfer in/out (downloads - customers getting our software; uploads: nightly builds) vastly outweigh the CPU/compute/instance charges.

We picked AWS mostly because they are close to the backbone and because you really get something close to bare metal access. At the time this decision was made, similar access from various other providers was either more expensive or non-existent.

Our EC2 is cheap. Our RDS however...