AWS launches slew of new services to fend off competition: Page 2 of 2

Keeping ahead

The Seattle, Washington-based cloud player is the acknowledged global leader in public cloud computing. Beginning in 2006, the company began offering cloud services by renting either compute, networking or storage services to companies, which want to consume IT services in a leased manner.

In its early days, it was a favourite of early adopters such as startups, which usually do not have legacy IT infrastructure and software to grapple with. Its pay-as-you-go model also sat well with companies that do not require their own infrastructure to host their software apps. This perfect for startups.

But over the past five years, AWS has flourished into not only a firm favourite for startups but is also being taken very seriously by larger, more mainstream enterprises as well.

The company has grown by leaps and bounds having recently recorded a revenue rise of 42% to US$4.6 billion during the last quarter, matching the 42% growth posted the previous quarter. Meanwhile, operating cash flow increased 14% to US$17.1 billion for the trailing twelve months, compared with US$15.0 billion for the trailing twelve months ended Sept 30, 2016.

In terms of market size, analyst firm Synergy Research has pegged the company as having a market size larger than its next five largest competitors combined. Another research firm, Gartner, said AWS remains the dominant market leader, not only in infrastructure-as-a-service (IaaS), but also in integrated IaaS and platform-as-a-service (PaaS), with an end-of-2016 revenue run rate of more than US$14 billion.

But while it continues to lead in the market and its dominance isn’t under threat yet from other cloud providers, AWS is cognisant of the fact that it must continue to innovate to stay ahead of the game.

The announcements made today by Jassy and other company officials were designed to allay any perception existing or potential customers might have that AWS has reached its peak and may not be continuing to innovate, given that rivals Microsoft Corp and Google Inc are ramping up their assault on the global cloud leader.

“I think one of the reasons why customers of all sizes – startups and enterprises – continue to choose AWS is because of how much more capabilities we have compared to anybody [other cloud providers] else.

“We continue to listen to what customers want and will innovate, as shown in the 22 launches made in my keynote this morning,” Jassy declared in a media briefing following his keynote.

Too much to take in?

Gartner research director Alan Waite said the most significant takeaway for him is the vast number of services AWS is introducing this year – some 1,300 compared to last year’s about 1,000 – a sign that it is trying its best to stay markedly ahead of its nearest competition.

Asked if there were any drawbacks to this, Waite, who spoke to Digital News Asia on the sidelines of re:Invent 2017, said the challenge is for customers to be able to absorb and understand the real impact of these new services.

“AWS is serious about innovating but the challenge in introducing so many services is to map out what will work for customers and what won’t,” he said. “The real impact of such announcements could potentially be lost on customers.”

Waite also argued that with so many services, it is going to be a challenge for technical people in companies to be able to upgrade their skill sets in order to take advantage of these features.

“The question really is how customers in different phases of the cloud adoption curve are going to be able to learn, understand and ramp up their knowledge such that they are able to deploy this huge array of services,” he argued.

As to how this can be addressed, Waite said education is key but there is only so much that can be done. Companies would need to pay attention and have an overall cloud architect to ensure that everything is done in a holistic and strategic way.

Jens Butler, director of services and outsourcing for Tech Research Asia, concurred and added that the vast array of announcements is what AWS normally does in its annual conference. However, as the cloud giant grows, so will the announcements it makes at these events.

“Partners are also finding it hard to keep up with these developments,” he told Digital News Asia (DNA) on the sidelines of re:Invent 2017. “Customers, I fear, may also only end up trying out services they are familiar with instead of the whole gamut of what’s on offer, and as such may not be able to derive the full benefits of what AWS is bringing to market.”

Edwin Yapp reports from the AWS re:Invent 2017 in Las Vegas at the invitation of Amazon Web Services Inc. All editorials are independent. He is contributing editor to Digital News Asia and an executive consultant at Tech Research Asia, an advisory firm that translates technology into business outcomes for executives in Asia Pacific.

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AWS seeks to extend its lead amidst competition gains

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