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Amazon EC2 (Elastic Compute Cloud) lets you rent virtual computers in the cloud. These virtual computers, called instances, run software and store data. You can choose different sizes of instances depending on your needs, and only pay for what you use. It's like having a computer in a data center, but without the hassle of buying, setting up, and maintaining the hardware yourself. This makes it ideal for running websites, applications, and databases, among other things.