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EC2 pricing is more in Cape Town than in Europe. Not great, especially with the recent collapse in the rand/dollar exchange rate.
Edge locations in Jhb are almost certainly co-hosted. But internationally, Amazon has been moving away from cohosting. My guess is, people are all jumping on the, we can charge you whatever you want because you run AWS bandwagon which forces Amazon to move over to their own data centers.
We have a few On-Demand EC2 instances in EU (London) and they are a bit cheaper than the equivalent servers in the Cape Town region.
I'm guessing things get cheaper the more the region gets used, so there must be some dynamic scale in play over time.
Obviously right now it's one very expensive warehouse with very little traffic going through it so costs a bundle to run.
Unfortunately due to the crash of the rand we're seriously looking at moving back to using self-managed dedicated servers at Hetzner. I love the flexibility of Amazon but damn it's become just too expensive to use now.