Cloud & Infrastructure · head to head
Neon vs Lambda (AWS Serverless)
Lambda (AWS Serverless)
Cloud & Infrastructure
Run code without thinking about servers
- From
- Free
- Rated
- -
The short version
- Each has a real cost: Neon compute pricing at $0.106-$0.222/CU-hour means costs scale directly with workload, unlike fixed-price alternatives; Lambda (AWS Serverless) billed on two axes at once, $0.20 per million requests plus $0.0000166667 per GB-second of duration, so memory settings change the bill as much as traffic does
- They diverge on capability: Neon covers Serverless PostgreSQL, Lambda (AWS Serverless) covers Function-as-a-Service.
Where they differ
Only the attributes on which Neon and Lambda (AWS Serverless) actually diverge.
| Attribute | Neon | Lambda (AWS Serverless) |
|---|---|---|
| Pricing model | Unknown | usage-based |
| Platforms | Cloud | Web, Api |
| Founded | 2021 | 2014 |
Identical on both: starting price (Free), free tier (Yes), user rating (Not yet rated), category (Cloud & Infrastructure).
What each one covers
Drawn from each product's published feature list. An absence here means we hold no record of it - not that the product lacks it.
Only in Neon
- Serverless PostgreSQL
- Database Branching
- Autoscaling
- Bottomless Storage
- Point-in-time Recovery
- Connection Pooling
- Read Replicas
- Instant Cloning
Only in Lambda (AWS Serverless)
- Function-as-a-Service
- Event-driven execution
- Auto-scaling
- Pay-per-use
- Multiple languages
- Concurrency limits
- Dead Letter Queues
- Environment variables
Both cover
- Cloud deployment
- Web support
What people use each for
The jobs each tool is most often brought in to do.
Neon
- Serverless applicationsnot Lambda (AWS Serverless)
- Development databasesnot Lambda (AWS Serverless)
- Preview environmentsnot Lambda (AWS Serverless)
- Testingnot Lambda (AWS Serverless)
Lambda (AWS Serverless)
- Event-driven functions without managing serversnot Neon
- API backends behind API Gatewaynot Neon
- Processing S3, DynamoDB, SQS and Kinesis eventsnot Neon
- Scheduled jobs without a always-on instancenot Neon
- Edge compute through Lambda@Edgenot Neon
Where each one falls short
Documented limitations, not opinions. Every one is a constraint you would hit in normal use.
Neon
- Compute pricing at $0.106-$0.222/CU-hour means costs scale directly with workload, unlike fixed-price alternatives
- Separation of compute and storage may add complexity to cost prediction compared to all-in-one plans
Lambda (AWS Serverless)
- Billed on two axes at once, $0.20 per million requests plus $0.0000166667 per GB-second of duration, so memory settings change the bill as much as traffic does
- Provisioned concurrency, used to avoid cold starts, is charged separately at $0.0000041667 per GB-second whether or not the function runs
- Ephemeral storage beyond the included 512 MB is metered
- Lambda@Edge costs $0.60 per million requests, three times the standard request rate
- VPC use and cross-region data transfer carry EC2 charges on top
Pricing, plan by plan
Neon
Free- FreeFree
- 100 CU-hours/month
- 0.5 GB storage
- 1 project
- Launch$15/month
- Pay-as-you-go compute
- $0.35/GB storage
- Multiple projects
- Scale$31/month
- Higher compute rates
- 99.95% SLA
- HIPAA compliance
Lambda (AWS Serverless)
Free- Free TierFree
- 1M free requests/month
- 400,000 GB-seconds/month
- Always free
Which should you pick?
Choose Neon if
- You need serverless postgresql.
- You want to start without paying.
- You work on Cloud.
- You also want database branching.
Choose Lambda (AWS Serverless) if
- You need function-as-a-service.
- You want to start without paying.
- You work on Web, Api.
- You also want event-driven execution.
Questions people ask
- Is Neon or Lambda (AWS Serverless) better?
- Neither clearly leads. Neon starts at Free and Lambda (AWS Serverless) at Free, and user ratings are close enough to be indistinguishable. Choose on capability and platform support.
- Which is cheaper, Neon or Lambda (AWS Serverless)?
- Neon starts at Free and Lambda (AWS Serverless) at Free.
- Does Neon or Lambda (AWS Serverless) run on more platforms?
- Neon runs on Cloud. Lambda (AWS Serverless) runs on Web, Api.
- Can I use Neon for free?
- Both have a free tier, so you can try either at no cost before committing.
- What is Neon best used for?
- Neon is most often used for serverless applications, development databases, preview environments, testing. Of those, serverless applications and development databases are not what Lambda (AWS Serverless) is typically brought in for.
- What can Neon do that Lambda (AWS Serverless) cannot?
- Neon covers Serverless PostgreSQL, Database Branching, Autoscaling, Bottomless Storage. Lambda (AWS Serverless) covers Function-as-a-Service, Event-driven execution, Auto-scaling, Pay-per-use. Both handle Cloud deployment, Web support.
Answered from the vendors’ own pages
Neon: What is Neon and what makes it different?
Neon is a serverless PostgreSQL database that separates compute and storage, enabling automatic scaling and instant database branching. After acquisition by Databricks in May 2025, pricing has been significantly reduced.
SourceNeon: Does Neon offer a free tier?
Yes, Neon's free tier includes 100 compute units per month and 0.5 GB of storage. This is suitable for development and small projects.
SourceNeon: What are the paid plans and pricing for Neon?
Neon offers consumption-based pricing on Launch ($0.106/CU-hour, approximately $15/month) and Scale ($0.222/CU-hour, approximately $31/month) plans with separate storage billing at $0.35/GB-month. No monthly minimum required.
SourceNeon: What features does Neon provide?
Neon includes git-like branching for database copies, point-in-time recovery, data anonymization for testing, managed authentication, serverless functions, and object storage that branches with projects.
SourceNeon: What compliance and reliability guarantees does Neon provide?
Neon's Scale tier offers 99.95% uptime SLA, HIPAA compliance, SOC2 certification, and private networking via PrivateLink at no extra cost.
Source