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Most of the cloud providers I have come across are based in the US. No such bad thing I know. My concern for a Eurozone or UK start up is the currency fluctations.

For example: Amazon EC2 instances are USD charged (prices calculated with Amazon’s calculator).

Instance Type Total Hours Annual Cost (USD) Cost at May 2008 ($2.00/£1) Nov 2008 ($1.486)/£1) Annual cost difference
Small Instance 8760 hr $876 £438 £589.50 £151.50
Med Instance 8760 hr $3504 £1752 £2358.00 £606.00
Large Instance 8760 hr $7008 £3504 £4716.01 £1212.01

Obviously currencies will fluctuate daily but it is an eye opener for a UK start to see how much the costs incurred on a larger instance will be. This doesn’t take into account anything like S3 storage or SQS charges. Even if you moved S3 storage to an euro based account you have transfer costs to take into account.

So, the likes of GoGrid, Aptana, Flexiscale and Amazon all charge in USD and make the case for Cloud in the UK a cost problem if you don’t financially plan properly in the start up phases.

I know the costs are purely theoretical as the $2.00/£1 exchange rate was six months ago and it’s steadily slid during the course of the year. If things continue in that trend and a $1/£1 exchange rate happened (stranger things have) the costs in the Eurozone and the UK will steadily increase.

If you take a UK company for example, a single instance in its most basic form, starts costing the following:

Monthly USD May June July August September October
Small Instance 73.2 £36.99 £36.75 £36.95 £40.21 £41.21 £45.35
Med Instance 292.8 £147.96 £147.00 £147.78 £160.85 £164.85 £181.39
Large Instance 585.6 £295.92 £293.99 £295.56 £321.71 £329.69 £362.78

Learning Python and going with Google’s AppEngine will start to appeal to small scale companies purely to exercise cost savings.

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