At our level, switching to AWS would reduce our per minute cost from $0.08 (HD costing 2x normal minutes) to $0.03 (62.5% cheaper). So our $120 bill would go down to $45.
As a small startup, every $1 makes a difference and the price discrepancy will only increase as our usage increases.
I'm curious if you're concerned about erosion of your low-volume customer base eventually leading lost revenue from future high-volume customers.
But in all seriousness I look forward to the post.
So are you working on designing them out? Or are you counting on them never giving your AWS account short shrift?
The only reason they're the leading computing platform is trust. Trust is the biggest factor in a platform decision, and they'd be foolish to put all their other business at risk for a temporary advantage in one small slice. Especially since they are still making money on every Zencoder job.
Is there a lot of that left since they knocked Netflix offline on Christmas eve?
Really? One example: When states threatened sales tax (before CA), they cut off retailers in those states.
They can and they have given people short shrift when it's in their business interest. To be fair, that just means they know how to increase sales by selecting who gets thrown to the lions, which is necessary in any business.
I think most people making platform selections are mainly focused on AWS. I'm sure they pay some attention now to Amazon proper, but their affiliate programs were a peripheral thing, and
1. Our larger customers don't pay more than this already.
2. Paying 33% less doesn't necessarily mean getting 33% more value.
We'll be writing up an analysis today. Off the record (ahem), we've known about this for a long time, and we aren't worried.