Hi Sasha,

It is indeed more expensive to run App Engine than the alternatives you
mentioned for a few reasons:
- We have a lot of infrastructure built out around the core machines that we
don't charge for specifically but are included in the price of what you pay
for (the request queue, the scheduler, all of the free APIs, etc)
- It is a fully support service meaning there are people who keep it running
24 hours a day, even when something goes wrong in a datacenter (which will
happen at some point) we ensure it is not up to you to fix it.

There have been a number of posts to the list about people running really
small services that could fit on a single EC2 micro-instance, if what you
are running can fit on that, and you never expect to scale past that, EC2
will likely be cheaper.  But part of what you are getting with App Engine is
the ability to scale when you need to without having to completely
re-architect your app and without having to wake up if it happens in the
middle of the night to figure out how much capacity you need.  Frankly
though, even on small apps, EC2 might not be cheaper if you have an app that
gets very little traffic as App Engine apps under the free quota are free
indefinitely whereas I don't believe any other service offers free capacity
indefinitely.

Hope that helps explain it,

Greg

On Fri, Sep 2, 2011 at 5:27 AM, Sasha Hart <s...@sashahart.net> wrote:

> On Sep 2, 2:08 am, keakon lolicon <kea...@gmail.com> wrote:
> > I wish I was the one who made a wrong decision.
>
> Ouch.
>
> It is sad that the billing changes seem to price a ton of
> international customers out of the market.
>
> I wonder if recent events mean that the App Engine model (for lack of
> a more precise term - here I mean the technology, not the business) is
> just inherently much more costly than alternative models (like typical
> VPS or EC2). Does the price reflect additional technological overhead?
> Could others make changes to the model to run a similar service more
> cheaply?
>
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