Can you supply more details - maybe I am missing something. My EC2 instance has been up for 249 days now and my node.js webserver instance seems very responsive. I still think it's a reasonable trade-off in terms of cost. My time is expensive, and to be honest even a few hundred dollars a month extra in server cost is not important. This is a research project, not a commercial website, so my needs may be different than most.
I may not be hitting the points that macspoofing was trying to make, but at least in my experience, you can get much better value with a different host (like DigitalOcean or Linode) where the setup time is minimal and the performance benefits are substantial. However, if your priority isn't perfomance/dollar, then the trade-offs are subtle and insubstantial and EC2 is fine.
We did a test of an EC2 data centre setup vs. our existing physical data centre setup and the largest issue - that is, if you ignore the 3x cost - is the network latency and general quality of the local network in the availability zones.
No amount of optimization could eliminate the 100-150ms penalty imposed by the EC2 network vs. our dedicated hardware. The local network was congested and "noisy" in the sense that ping times were highly variable and had high packet loss, and the number of hops to the internet at large were high, and the baseline latency to the world was also high.
As for instance lifespan, we had numerous instances just "disappear" and then needed to be recreated. We were running a hundred or so for our test so YMMV.
