Amazon has expanded into renting online computing resources. The company will provide computing resources on demand to developers, allowing them to get access to raw computing power without having to shell out big bucks to buy expensive kit.

Known as Amazon Elastic Compute Cloud (EC2), the service will allow developers to buy hosted server processing services at 10c an hour plus 20c per 1G of traffic and 15c per 1G of storage per month. The service works in conjunction with Amazon's Simple Storage Service, and gives developers a virtual computing environment within which they can do just about whatever they want. Each virtual server instance they get gives them the equivalent of a 1.7Ghz Xeon CPU, with 1.75GB of RAM, 160GB of disk space, and 250Mb/s of network bandwidth.

According to Amazon: "It is designed to make web-scale computing easier for developers. Amazon EC2 enables "compute" in the cloud. Amazon EC2's simple web service interface allows you to obtain and configure capacity with minimal friction. It provides you with complete control of your computing resources and lets you run on Amazon's proven computing environment. Amazon EC2 changes the economics of computing by allowing you to pay only for capacity that you actually use."
Hosting a website that competes directly with Amazon, hosting discussion groups that criticise Amazon's service and products and even maybe hosting porn seems to be on the cards for this new service, according to the TOS. There is a clause, however, that states that if your application is determined (for any reason at all) to be unsuitable for Amazon Web Services then it can be suspended. Basically, this translates to "you can do whatever you want, so long as we like it."