How to make AWS costs look low

I tried Amazon's TCO calculator for EC2, and the results for on-site costs seem absurd. One VM, with 4 GB of memory and 500 GB SAN storage, they estimate at $156,989.00 for three years on-site. That does not include labor. Co-location they estimate at $181,111.00. For one VM, for three years. That seems a bit high. I get that they are trying to make EC2 seem cheap in comparison, but the numbers seem laughable.