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John C.
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I don’t use EC2, so haven’t had to deal with DR from that perspective. I only use S3 as a backup location for physical servers, so S3 is part of DR for those servers. If, on the very off chance that S3 were to ever be unavailable for an extended period, I would still have the original content as well as offline backups.

From my understanding of EC2, it is possible to export VMware images for offline backup. Could you possibly download these on a regular basis and plan to import them onto a physical server? Obviously you would need to have access to a physical server in the case of a disaster.

I think many companies do the opposite of what I describe above – i.e. use their physical servers as their primary servers, but have EC2 available for DR.