In any price comparison, it's easy for the party making the comparison (Gandi, in this case) to select the parameters to their advantage. They just need to find the sweet spot in their offering, and make sure to choose the competitor's highest-priced offer to compare it to. We will take a “no bullshit” approach to this comparison, and be completely transparent about what we find.

Amazon came out with Xen-based hosting with the Elastic Compute Cloud (EC2) just prior to Gandi's introducing VPS hosting, so it's no surprise that they are similar. They both address the need in the market for low-cost Linux-based cloud computing. Amazon, with its extremely large infrastructure and plenty of systems programmers, was able to add lots of nice features to EC2, and integrate the S3 cloud storage system. They do charge for the use of those features, naturally. Gandi has a somewhat different model, and packages storage, bandwidth, and CPU cores in flexible shares that you can adjust, and pay for the package you use. For this comparison, we have taken the most cost effective Amazon instances and comparable services, and constructed Gandi share packages to match as closely as possible what Amazon offers.

Another factor that drives the cost of Amazon's service is usage: They charge for transferring data to and from an instance, as well as storing that data. We made some assumptions that we will be very up-front about: We assume you will actually use the network and the storage capacity you contract for from Amazon. It turns out that if you make light use of the Amazon instance while you have it running, it's actually quite cheap, even relative to Gandi's prices. The question then becomes, what is the point of having the instance (and paying the minimum price) if you aren't going to use it for something?

So, what did we pick? Well, we chose 3 basic instance sizes from Amazon's price list:

Small (1.7 GB Ram, 1 core)

Large (7.5 GB, 2 cores)

Extra Large (15 GB, 4 cores)

Gandi charges by the month, if we ignore Gandi Flex, a feature Amazon does not have. Amazon charges by the hour, so to be fair, we decided to compare running the instances for a solid month.

Next, we considered storage. Gandi offers disk management, backups, and snapshots, all of which Amazon also offers, but only if you use EBS-backed disks. If you don’t, the primary storage on Amazon instances vanishes when you terminate the instance, so it’s not really comparable to what Gandi offers. We therefore decided to compare the more expensive EBS storage to Gandi’s disk images. We chose small (by today’s standards) 32 GB disks for the small and large size instances, and kicked it up to 160 GB for the Extra Large.

Finally (and yes, this is getting to be a long post!) we looked at network usage. Amazon charges by bytes transferred out from the instance, and not in. Gandi charges for a block of bandwidth (5 MBits per share). We will assume that you have a reasonably data-centric application, and you use, say, half the available bandwidth to constantly transfer data out.

For Gandi’s resources, we just adjusted the shares, RAM, and disk to match that of the Small, Large and Extra Large instances using the slider here.

Putting all these costs together, adjusting for Euro/Dollar exchange rates, and excluding VAT, we get:

It looks to us like Gandi’s prices are from a third to a half of Amazon’s for similar resources, without support, which Amazon charges for separately as well.

Of course, if you need to run MS Windows on the cloud, or take advantage of some of the other features Amazon offers, it may make sense to use Amazon. Also, Amazon is free to adjust their prices to compete. If what you want is Linux hosting, though, Gandi is a lot easier on your budget for the same resources.