As pointed out by Todd on the mailing list during what should probably be known henceforth as "The Interregnum", the ECS is an Amazon service consisting of virtual servers, running any image that can run on Xen (yes, it's Linux-based -- I posted in the Software forum because you can actually run a Windows image based on QEMU and Fedora).
Amazon provides tools to create and modify the images. Images are uploaded to Amazon's Simple Storage Service (S3) and activated via an API.
- Unlimited computing - start as many images as you like.
- Pay-by-the-hour pricing (also pay-by-bandwidth and pay-by-GB S3 storage).
- Create custom images; do what you like. It's your virtual box.
What's not so cool:
- Complexity. You have to configure the images on the fly after you start them.
- Not so inexpensive as you may think. The equivalent in bandwidth/hours/etc. to my $50/month colo is over $200/mo.
- Images are weird to build and not so well documented.
- Everything is dynamic DNS only. Either you use something like dyndns.org to manage the host names or you write your own service. You still need to have a static central server to serve as a launch point from a real domain name.
- It's still beta, and therefore an unknown quantity. It's not really useful for basing anything serious on yet.
What uses can you think of?