Amazon’s EC2: Bringing cloud computing down to Earth

amazon web servicesCloud computing is becoming the next hot item in a changing tide that is replacing the well entrenched product model, with a new, on the fly, pay as you go, service model.

The new Virtual servers, are to the classic server, what the SAAS models, where software is being sold as a service, are to the traditional boxed software.

amazon cloud computingLeading the latest virtual server charge, is Amazon’s Elastic Compute Cloud (Amazon EC2). The basic idea is that a developer can set up a virtual server (the actual servers are hosted by Amazon) in minutes, and have none of the maintenance headaches of buying and installing server hardware and software, which can take weeks to get up and running.

The pay as you go model is cheap and flexible . If your computing demands increase, there is no need to buy any more hardware. The “resizable cloud” provides a scalable computing environment.

The whole idea of Utility computing or Grid computing, is not entirely new. It was pioneered by IBM, and was offered to consumers by Sun in 2000 as part of the Sun grid service.

Amazon’s Elastic Computer Cloud (EC2), released in a limited Beta, is the latest offering from Amazon Web Services, AWS. It follows Amazon’s earlier cloud storage service Amazon Simple Storage Service (Amazon S3).

Amazon’s on-demand web service platform is creating a host of opportunities for start-ups. A company called RightScale based in Santa Barbara, CA, is providing a platform on top of AWS virtual servers, that enables companies to create scalable web applications within the new paradigm created by Amazon’s EC2, S3 and SQS. RightScale is currently in beta.


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Spyfu: Spying on the competition

spyfu logo

Spyfu is a company that lets you spy on your competitors site - you can find out how much they are spending on paid advertising per day. You go to their website and enter a domain name, and you get back the online advertising budget numbers for the site, along with the tool clicks per day and the average cost per click.

The free site provides limited content, but the subscription site promises tools to track and analyze a site’s paid keywords, average rank, number of clicks per day, number of CPC ads etc.

spyfuHere are daily budgets of some high rollers in the online advertising world, from the Spyfu site. $124k - $452k $12k - $362k $84k - $336k

The spread in the numbers is rather large. To make this more useful, the site needs to publish the numbers within some tighter tolerances.

In general, when advertisers sign on to place paid ads on a search engine, most of the click and keyword average pricing data are made available to them. It is possible to get statistics on the number of times a particular keyword is being searched, and how many clicks you are likely to get at a particular cost per click (CPC), so Spyfu is probably just aggregating data, and presenting it conveniently in one place, along with some estimates.

Overture (Yahoo) freely publishes click costs and traffic estimates, but Google adwords has a strict policy of not allowing advertisers to see what other merchants are bidding on a particular keyword. So it is not clear if Spyfu is getting any data from Google at all, or just making educated guesses based upon Yahoo cost estimates.

Here are the most expensive keywords - yes that is the max price the merchants have bid for every click to their site, for those keywords!
spyfu top 100 most expensive keywords

We tried Spyfu on some domains and the results were reasonable. However, for domains that did not advertise on the big three search engines (Google, Yahoo, MSN), we could not get any advertising numbers even though the sites are advertising on several smaller search engines.

At first pass, this seems like a very useful tool for online merchants to use. Here are some of the features Spyfu needs to add to its offerings.

1. Add tier II search engines into its estimates
2. Use better filtering for their search terms (they list words such as “a”, “www” etc. which google and other search engines remove as they are very common terms)
3. Get a faster server - the queries are very slow 50% of the time
4. Either get more precise numbers for the ad budgets, or label the numbers as “estimates”.

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