There is more than one way to get your Windows-based database-driven applications into the 'cloud'. Microsoft's Platform as a Service (PaaS), formerly known as Azure, is now joined by Amazon, who have announced support for SQL Server alongside MySQL and Oracle in its AWS-based Relational Database Service (RDS). Amazon is also providing .NET support via their Elastic Beanstalk, and Visual Studio integration, so the two products are starting to look very similar.
This is a significant event because the presence of more than one provider makes any service seem more attractive. In a sense, Amazon has been providing SQL Server and Windows in the cloud for a while, on EC2. This uses Windows AMIs (Amazon Machine Images) to launch Amazon EC2 instances with Microsoft SQL Server, inside or outside a VPC (Virtual Private Cloud), but this has been more akin to a hosted service.
RDS is much more like Azure, because the underlying EC2 infrastructure auto-magically expands and contracts to meet the demands of the database workload. RDS also takes care of deploying, patching, and backing up of the database.
Of course, RDS is not new; it has been running for two and a half years now, but SQL Server support is new. Express, Web, Standard, and Enterprise Editions of SQL Server 2008 R2 are included, with the promise of 2012-support later this year. Support for .NET comes via the Elastic Beanstalk PaaS, which runs Windows Server 2008 R2 AMI and IIS 7.5. You can use Visual Studio, with the AWS Toolkit, to deploy existing web applications to the cloud, and to deploy to RDS databases. Equally good news for the DBA, is that trusty third-party tools such as SQL Compare work with the new service just as they always did (SQL Connect even gives you a direct connection from within Visual Studio!).
In addition to this, Tier 3 launched a CloudFoundry-based PaaS called Web Fabric that supports .NET framework, and their data Fabric supports SQL Server. This service is more akin with Amazon’s EC2-based AMIs, but based on VMWare.
Although one could argue that the database-hosting service by the PaaS formerly known as SQL Azure provides a neater and more manageable service than RDS, the important point is that there are now two alternative services. Amazon wouldn't have been able to sort out the licensing without the cooperation of Microsoft, so one must assume that the arrangements were intended to increase the cloud hosting market for SQL Server and show the world that the services were competitive.
It is comforting for any business contemplating moving their windows-based IT services to the cloud that they are not forced to turn to Microsoft as their service provider as well as their software provider. It takes away one of the stumbling points that has hindered take-up of Cloud services.