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The barrier-to-entry on AWS is in fact infinitely lower than on Linode:

http://aws.amazon.com/free/

The ongoing TCO of AWS is much higher than Linode, of course. But that's precisely my point: you want to capture customers at birth, incubate them into adulthood, and then charge them a lot of money now that they can afford it.




Yeah, do you know how awful a t1.micro is? It's a joke. I've never seen steal% that high before. There must be thousands on a single machine.

Although if you want to be pedantic, let's say "actually useful, potentially-production barrier to entry". There. Fixed.

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A friend of mine is running an ASP.NET MVC/Mono/MongoDB ecommerce site on micro with around a quarter million of annual sales. The site is very very fast.

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If he hasn't already, get him to do a write-up on that. I'd sure be interested, and I'm sure many others would be as well.

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The high steal% is intentional, as the CPU is allowed to burst to take advantage of unused resources:

http://docs.aws.amazon.com/AWSEC2/latest/UserGuide/concepts_...

I don't find my cheap t1.micro based IRC bouncer / VPN / reverse SSH endpoint / static-content generation box to be an awful joke at all. They're quite useful for many things.

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You also want to avoid scammers and fly by night operations that don't value your business other than to find cheap CPU and bandwidth. There is a set level of overhead for each new customer, and new customers are probably more likely to need additional support. The lower you go with pricing, the larger this portion of your costs eats into your profits.

There are $10 VPS solutions out there, but their poor reputations lends credence to the idea that $10 VPS solutions are not where the money is at.

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There is Hetzner.de which I like quite a bit as a company. I have been hosting with them for 3 years. They have a 512box for 6.5 EUR if you are exempt from taxes like a Non-EU citizen .

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The $10 VPS solutions I see out there are either in a European country, or are startup/smaller shops that don't have a proven track record.

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Just don't try to use EFnet or QuakeNet from them.

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