Amazon Virtual Private Clound (VPC) fundamentally enables the extension of a traditional network in the Amazon Cloud by a site-to-site IPSec VPN tunnel. Each VPC is isolated at a network level from other VPCs and the shared AWS services - your standard public EC2, RDS etc.
The following links give more detail
AWS Product Page - Amazon Viirtual Private Cloud (Amazon VPC)
Amazon CTOs Blog - Amazon Virtual Private Cloud
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