What do you think about selling VPS solutions by using Amazon's EC2? So whenever an order comes in, you just setup an Amazon EC2 service and give the access details to your client.
Just mark up whatever Amazon is charging us like a 20% margin or something for our setup service.
Would you think this is doable in the VPS market?
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I think it is a bad idea to serve as a reseller of any major Cloud. If anyone goes there than there will be a very few technologically advanced providers (Cloud hosting providers if you prefer) and very soon we will see the prices sky-rocketing. I think that it is worth to invest in building your own Clouds... This is reasonable for providers who serve more than 10,000 of customers and who want to stay on the market and to be competitive.
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Not sure if it's a viable market but it is being done. EngineYard does this with their 'Solo' product.
Don't forget that by default, the storage on EC2's aren't persistent, and you could be in a world of hurt if you sell a "VPS" without persistent storage and Amazon brings down the node that instance is on, causing data loss.
Perhaps interfacing with the Rackspace Cloud API would be a better solution, since it's basically a Slicehost per-hour VPS.