http://www.allthingsdistributed.com/2012/01/The-AWS-Storage-...
http://aws.typepad.com/aws/2012/01/the-aws-storage-gateway-i...
This solution isn't designed to replace fault-tolerance on local hardware. It is for close to realtime offsite replication and backup.
Data in S3 is stored in at least three geographically separate locations and snapshots are very fast and very efficient on storage space.
The final major advantage you get through a solution such as this is that if you do have your primary site go down (floods, tornados, etc), you can bring up all your existing images via EC2 without having to have a bunch of redundant hardware sitting around waiting for disaster to strike.
And what do you pay for this? $125/month plus a per GB storage cost CHEAPER than enterprise storage generally is.
1: http://www.allthingsdistributed.com/2012/01/The-AWS-Storage-...
1: iSCSI can be seen as a USB drive over a network. you plug in, your machine sees it as a drive, you write data. you can unplug, and then plug in somewhere else, and as long as the file system is readable on the new machine, you can get your files. 2: the appliance AWS are offering gives you iSCSI volumes, backed by DAS or SAN storage locally, but also backed by S3 storage in AWS.
So, basically, its like having a drive, automagically backed up to S3, but S3 does not need to know anything about what is on the drive. it could be VMs, Videos, your mail server... anything really.
Not only that, it solves a lot of problems such as dangerously storing backup snapshots on-site, archival and easy deployment and access to S3's CDN functionality.
Sold as far as I am concerned!
(Yes I know it's expensive, but it's cheaper than buying something in-house and employing another hairless monkey to manage it).
This would make a wide range of big-storage use-cases ridiculously trivial - those where only ~10% of the data-set is frequently accessed.
I.e. one could lazily scale the expensive local storage with throughput-demand, while the S3 backing store takes care of the long-tail (which can easily be many terabytes long when you're dealing with media files).