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Is such a stopping and starting again equivalent to a entering a regular "sleep" mode? Or do the RAM contents get lost and it's effectively a reboot?

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It would be good of you to go back and accept answers to your previous questions. – EEAA Jun 1 '12 at 21:43
up vote 2 down vote accepted

Stop/Start is the same as shutdown/startup.

So to answer your question, running processes need to exit gracefully on shutdown lest they be killed. Then on start, you either need to manually start them or start them automatically via your distro's mechanism (upstart, sysvinit, etc.).

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And to further expand @ErikA's answer, its NOT the same as a reboot. Its the same as starting a brand new machine with an exact clone of the original image or snapshot. – Andrew M. Jun 1 '12 at 21:51
@AndrewM. - Sorry, that's incorrect. Stop/start retains the state of the root image on EBS root machines. Instance Store machine cannot be stopped/started, only terminated. – EEAA Jun 1 '12 at 21:53
There are a number of differences between reboot and stop/start. Here's an article I wrote about this: – Eric Hammond Jun 1 '12 at 22:01
@EricHammond - Excellent article. – EEAA Jun 1 '12 at 22:03

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