How many customers use more than 1GB of outbound traffic per month for a $5 server? Data transfer in is free on EC2 and the first 1GB outbound is free too according to the pricing page.
ok, so about $6.90 per month for 1 year then including storage. Thats still less than a 1GB RAM DO server which goes for $10 per month, and much less if you go for 3 years. Factoring in 1 year of free tier makes it even less.
It's $77 for 1 year reserved if I'm reading it correctly. That's $6.44 per month for an instance with double the RAM of the DO $5 instance. The specs look like the size that DO is charging $10 for currently. For a 3 year reserved instance it's $4.48 a month for double the size of the DO $5 instance. There's also a free tier, so the first year is free to try it out.
DO was competitive with EC2 on price but not on features (and certainly not on security), now with the price advantage gone...