Funding development: assuming we don't charge a monthly fee (e.g., $5/month) how much should we add to Amazon EC2 usage fees?

To clarify our thinking, we're currently considering simplifying the pricing somehow (e.g., only usage fees or only a mark-up on usage fees) and we'd like some feedback on that.

Nearly a dozen people so far (38% currently) have voted for 0%. In other words, they think we shouldn't add anything to Amazon EC2 usage fees. Is that because of the monthly fee or because you don't think we should fund development this way? If so, does any one have any other good ideas?

Just in case, I've refined the question so it asks you to assume we don't charge a monthly fee.

Thanks for the feedback!

Anyhow, whether or not paying for bandwidth by usage is an issue depends on your usage case. The vast majority of web sites don't get enough traffic to use that much bandwidth anyway.

I agree that variable pricing is hard for most people.  A fixed monthly amount is better.

The biggest problem I see with EC2 is when they start charging for bandwidth (Which they will be doing starting June of this year according to their pricing page).  Then, people are really not going to know what their monthly charge will be. 

depending on target audience realize that introducing any additional variable expense to a company is an obstacle to adoption/purchase.  Businesses like to be able to budget/plan (or at least think they can) a specific amount each month.  In the end it depends on what your users/customers are primarily using the images for.  Is it for their (our) own use, or is it primarily to package and resell after we create the 'solution' on top of the image (i.e. specific application for end user).  The former creates less of a challenge IMHO then the latter.  If its resold utilizing ec2 then there is a variable expense on top of a variable expense and generating margins on an unknown will be a significant challenge for both the end user and those packaging the image.

also, and just to admit my own bias, I am not a fan of % pricing.  Even if variable based on tiers, static $/mo is simply more pallatable.

This discussion is about adding a fee on top of the Amazon EC2 fees as a way to help fund the project.  The idea is that you have to pay something to Amazon anyway (They do not offer their service for free) so adding a small increment will not be a large impact.

TKL will always give you VM images and ISOs for free so you still have a way to try it out.

We experiment with a lot of open source projects and some but not all end up being useful to us in production.  Paying up front fees is a barrier to experimentation and use.  We like to support those efforts that are helping us to make money and grow our business, but choose to donate directly down the road to a projects that make life easier for us.

If you look at Amazon's EC2 pricing page:

http://aws.amazon.com/ec2/#pricing

They have a usage fee, which is how much they charge per hour you are using one of their instances.

The poll is about adding a percentage to that fee.  Since it is a percentage, it can be applied to any type of EC2 instance since they all list a usage fee.

Also, trying to reach for perfection and make everyone happy may be impossible or at least impractical. Most of all we'd like to focus on development, and that means keeping everything as simple as possible. Hence our idea for a flat mark-up percentage.

Remember the resource pool from any mark-up is essentially reinvested back into open source development which the community benefits from.

This survey asks

      how much to add to AWS EC2 "usage" fees.

My first question is why tie the cost to EC2 instance costs?  

AWS has a lot of variation in pricing EC2 use

• Spot Pricing Instances
• Reserved Instances
• On Demand Instances

then there are various costs for different sizes of compute resources

• Small Instance 32 bit
• Med Instance 32 bit
• Large Instance 64-bit
• Extra Large Instance 64 bit
• High-Memory Double Extra Large Instance 64-bit platform
• High-Memory Quadruple Extra Large Instance 64-bit platform
• High-CPU Medium Instance 32-bit platform
• High-CPU Extra Large Instance  64 bit

These are all priced differently by AWS.

However from  an "Application Appliance" perspective there are really only two considerations (32 or 64 bit)

So should someone pay more $ to run the Appliance on the largest 64 bit machine resource than on the smallest?   I'm not sure the application's configuration changes does it?  So why should it cost different.

Next using EC2 "usage" ...

Remember AWS's EC2 usage fee includes your use of Elastic Block Store (EBS), load balancing, auto scaling etc.   None of those additional service costs for EC2 have anything to do with the Application Appliance... 

My point I guess is I'd like to better understand what the Poll Question means by AWS "usage".

thanks

I haven't spent much time thinking about this, but off the top of my head I think a 5% premium sounds reasonable for EC2 images. (I'm assuming) There will always be ways to tinker/learn for free with the existing VMs and ISOs. I would only move to EC2 instances when I am planning on going "live" with something and at that point I am willing to pay for the services I need to do so -- and that, in my mind, includes the work done by the TurnKey folks.

Originally, I was skeptical about the possibility of having to pay more to use TKL on the cloud.  After having access to the Hub, I don't see anything wrong with it.  Consider you would pay $30 a month for usage fees.  A 10% premium would mean you're only paying $33.  And with the possibility of Micro Instances, the difference could be barely noticeable.  For the simplicity the Hub provides, especially with TKLBAM, I would have no problem paying it.  It is clear that you guys are putting some serious effort into the project and I think it would be a great way to help it grow.

Thats such a cool way of looking at it! You'll fit right in around here Jeff!

The poll resulted in a roughly 11.8% surcharge, so you guys are implementing about a 15.25% discount on the community's own estimated opinion of value. That's awesome! I know everyone won't see it this way, but the numbers don't lie. :D

Thanks to everyone who provided feedback over the past year. The poll is closed and in accordance with the winning option Amazon will soon begin charging TurnKey users on EC2 a modest 10% premium on hourly usage fees.

The change will take effect in about two weeks, which should be just in time for the new TurnKey Linux 11 release, based on Ubuntu 10.04 Lucid, the most recent version of Ubuntu with Long Term Support.

Currently this modest premium will only provide the project with a few hundred dollars each month. Not much, but enough to cover some costs.

With the next release we're hoping to see usage increase significantly so that this premium will eventually add up to something meaningful that can help support future development.

Many thanks to the hundreds who voted in the survey and participated in the discussion throughout the last year.

At the time of poll closing, the results were as follows:

• 29% of you voted for 10%
• 25% of you voted for 0%
• 23% of you voted for 5%
• 22% of you voted for 15%+

For those of you who didn't follow the discussion, a few alternative ideas were introduced, including charging a fixed monthly fee instead of incremental hourly fees. We considered this, but ultimately decided that fixed pricing, though more financially lucrative for the project, would be a poor fit for the majority of our users. For example, is it reasonable to ask an individual that wants to run a quick 1 hour demo to support the project in the same proportion as a company running multiple instances 24x7?

To everyone who participated in the beta over the last year, thanks for trying out TurnKey Linux on Amazon EC2 and providing feedback!