There was a lot of Amazon Web Services related news last week, though the title of "news" is a little unwarrented. In reality, there were three excellent blog posts. The first had an excellent disection of Amazon's EC2 user ID's, the reverse engineering of which gives us an estimate as to the size of Amazon's cloud customer base. The estimate is that around 40,000 to 50,000 machines are running inside EC2 right now. From that, others have derived the yearly revenues for Amazon's cloud services: US$ 220 million.

By Lydia Leong (Gartner)

How much capacity does Amazon EC2 have? And how much gets provisioned?

Given that it’s now clear that there are capacity constraints on EC2 (i.e., periods of time where provisioning errors out due to lack of capacity), this is something that’s of direct concern to users. And for all the cloud-watchers, it’s a fascinating study of IaaS adoption.

Randy Bias of CloudScaling has recently posted some interesting speculation on EC2 capacity.

Enterprises can rewrite legacy applications and move them to the Amazon cloud with a new product from a vendor called Queplix.

CIO.com's guide to cloud computing and its various flavors, risks and rewards, providers, and more.

Customers will create a VPN to bridge Amazon to their existing IT infrastructures and use their existing security systems to protect data.

One of the early promises of SaaS (software as a service) and cloud computing was that it would allow startups to directly market their Web services while skipping the expensive, lengthy process of creating an ecosystem of partners and resellers. "Building the channel" was an antiquated strategy, they argued, a legacy of on-premise dinosaurs such as Oracle Corp. and Microsoft Corp.

By Lydia LeongThe various reactions to Amazon’s VPC announcement have been interesting to read.

Half of developers surveyed are using Amazon's EC2 cloud for prototyping, not to run a business critical application.

There's no question that cloud-computing infrastructures will become a significant part the IT plans of large corporations, according to analysts. The question, at least right now, is how well those hybrid internal/external infrastructures will be managed.

Despite its critical mass, Amazon EC2 is not that far ahead of Rackspace Cloud Servers (formerly SliceHost) in hosting working web sites. Google App Engine trails badly.