FD Insights Issue 12 | Page 25

O fficially launched in 2006, Amazon Web Services (AWS) was perhaps one of the first companies to be launched with an eye on the impending cloud revolution. Now 10 years later, the company is firmly entrenched as the market leader in its segment, with only Microsoft making any kind of inroads into its market dominance. AWS operates out of 11 geographical regions around the globe, and provides a highly reliable, scalable, low-cost infrastructure platform in the cloud that powers hundreds of thousands of businesses in 190 countries around the world. With data centre locations in the U.S., Europe, Brazil, Singapore, Japan, and Australia, AWS offers customers the opportunity to replace up-front capital infrastructure expenses with low variable costs that scale with their operations. Businesses no longer need to plan for and procure servers and other IT infrastructure weeks or months in advance. Instead, AWS gives them the option to instantly spin up hundreds or thousands of servers in minutes and deliver results significantly faster. According to Andy Jassy who spearheaded and now leads the Amazon Web Services (AWS) business, there was no “ah-ha” moment that lead the online bookseller to one day disrupt a trillion dollar technology market. Writes John Furrier on Forbes.com: “Operating with a focus on delivering better experiences internally and for merchant partners, like Target, to hear Jassy tell it, the concept of AWS was sort of stumbled upon while seeking to solve a recurring need, namely faster technology deployment. This trend would manifest as an entirely new and game-changing approach to technology development, which involved decoupling services. No one at Amazon knew at the time it would morph into what AWS is today.” What it is today, is a cloud computing platform like no other. AWS has close to 30% market share of the cloud infrastructure-as-a-service (IaaS) sector, and estimates Gartner, has 10 times the computing capacity of its 14 nearest competitors combined. It has more than one million customers, peak network traffic between its data centres is 25 terabits per second (Tbps), and customers ran 70 million hours of software on the platform in October 2014 using apps offered viaits online store, AWS Marketplace. A sample of household-name companies adopting AWS’ services includes NASA, the Obama Campaign, Pinterest, Kempinski Hotels, Netflix, Infor, Spotify, Dropbox, Netflix, Airbnb, General Electric, Samsung, the Commonwealth Bank of Australia, the BBC and even the CIA. AWS was broken out from Amazon.com as its own business segment in April 2015, and with sales of US$1.57 billion in the first quarter of the year, and US$265 million of operating income, AWS accounts for a large percentage of Amazon’s overall profits. It’s not stopping there either. Market analysts have forecast its annual revenue to cross $15 billion in the long-run (by 2019), based on the assumption that the cloud infrastructure and platform market could grow at around 30% CAGR to reach $43 billion by 2018 (according to Goldman Sachs). Many industry watchers back up the sales and revenue statistics in agreeing that the AWS market proposition is a compelling one. “Any new class of application that is built to efficiently use resources only when it needs them is going to move - the economics are just too compelling,” says James Staten, an analyst at the Forrester tech consultancy. “It’s also incredibly empowering to a developer that so many of the services they want are just sitting there. You don’t have to write them, you can simply connect to them and your application is finished.” As befits an industry behemoth like AWS, the company has its own annual showcase called re:Invent. According to Amazon, AWS re:Invent is, at its core, a learning conference, bringing together AWS users of all skill levels to connect, collaborate and learn about AWS. Sessions are delivered by subject matter experts, AWS engineers, and Solutions Architects or expert customers who can share their real world experiences and lessons learned. Agenda items at the industry’s largest cloud event include AWS certification exams, midnight hackathons, bootcamps, hands-on labs, gameday sessions, a global partner summit, compliance summits, late night hands-on labs and technical breakout sessions. The event also often showcases industry-first innovations, maintaining AWS’ position as a market-leader within the cloud space. Amazon WorkMail, an alternative to Microsoft Exchange, and AWS Lambda, a serverless microservices platform, are examples of the company’s push towards constantly shaking up the status quo. 23 | www.firstdistribution.co.za