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Is this going to enable me to build my own little remote gaming server with steam? I remember seeing someone attempt to do this with Linux GPUs a while back with EC2. I get the feeling things might be easier with on a Windows EC2 instance.
Yes. Very much so. I think there is potential to spin up remote gaming services (SaaS style) as well. Me and a friend spent several weeks attempting it on the G2 Linux instances with lots of progress.

We used a software called citrix xenapp for provisioning.

We where running AAA games 60 fps highest with little latency issues.

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Cloud gaming is popular, but I don't think that this suits cloud gaming. When gaming over the cloud, your machine needs a high end GPU 100% of the time the instance is running, and your users play for many hours. The startup time for a GPU-dedicated instance isn't large in comparison.
Isn't there latency problems if you render your game on the cloud? I mean, you need to move the frame from Amazon GPU to your GPU I suppose.
I'm currently a beta tester for Nvidia's GeForce Now[1], and it essentially gives you a Windows 2012 R2 VM with Steam installed to play games: Xeon E5-2697 v4 @ 2.30GHz (8 vCPUs allocated), NVIDIA Tesla P40 (24 GB allocated), 16 GB RAM, and 320 GB HDD. Latency is quite decent where I am, about 18 ms to the nearest data center. This is okay for casual, single player games, but it's still too much lag for competitive gaming (CS:GO, PUBG, etc.).

A similar service is LiquidSky[2], which interestingly has a free tier.

[1]: https://www.nvidia.com/en-us/geforce/products/geforce-now/ma...

[2]: https://liquidsky.com/

Another alternative is parsec: https://parsec.tv/ Comes with an amazon AMI to quickly get started on AWS. The team behind it strive for low-latency, and has support for controllers + multiple clients connecting to a single host to allow "local multiplayer" online
I don't know how well this would work for a twitch game like Overwatch or Call of Duty, but I could see it working very well with games where timing isn't a factor, like X-COM or Civilization.

Has anyone played a twitch game over a service like this that can comment on how well this works?

Wait so data I push to my GraphicsBuffer/GPUMemory...

I get charged for that right? As network data?

Probably not. Intra-AZ traffic in AWS has always been free and intra-region has always been pretty cheap.
DirectX, Cuda and OpenCL are not supported. Only OpenGL 3.3 supported. Makes this very limited for now.
I wonder what the balance of local work in the ICD is to RPC. I wouldn't have thought to proxy OpenGL to an IP network for anything interactive, but their example given is KSP.
Can someone confirm support for OpenGL 4.0 on these?