Google App Engine vs Amazon EC2

Our term project titled Hoo is a Question Answer system and we are using a Named Entity Tagger which will tag the person names in any given sentence. This tagger was demands a lot of memory and so we had to find a hosting service that would address our memory needs. Initially, I was trying out Google App Engine (GAE). Itz got a nice plugin for eclipse and so developing / deploying a Java web app is so much easy. The major issue I faced was with the various constraints set by GAE. Your request cannot take more than 30 seconds, your static file cannot be more than 10 GB etc etc gave us a hard time deploying the app in prod environment of GAE. So as I was analyzing other solutions, I hit upon Amazon EC2 instance. This is just too good. EC2 also has a great eclipse plugin from which I can start my EC2 instance, manage and monitor it and more. This was a perfect solution, as we got a machine with 1.7GB RAM and 3 Ghz processor for 10 cents / hr and a static IP for 1 cent. But over a period of time, this solution is expensive but if you have a lucrative website and you want perceive growth, EC2 is probably one of the best options..