Amazon Web Services – More Like Apple than I Realized

  • December 12, 2013
  • Scott
  • 0 Comments

Great read from Bernard Golden, on Amazon’s Web Services.

Most CSPs execute a strategy based on the proven designs, components, and practices of the hosting industry, viewing them as non-core activities that detract from differentiable business elements like brand or customer base. This logic is unassailable, given the view that cloud computing is the latest extension of a well-established industry.

For the uninitiated, this is the principle behind horizontal integration which powered the Wintel duopoly for example.  The assumption by most players in the cloud service provider business is that it should play by those horizontal industry rules.  But Amazon connects with its inner Apple here, controlling the deep details of AWS:

Amazon, however, appears to hold the view that it is not operating an extension to a well-established industry, in which effort is best expended in marketing and sales activities pursued in an attempt to build a customer base that can be defended through brand, selective financial incentives, and personal attention. Instead, it seems to view cloud computing as a new technology platform with unique characteristics — and, in turn, has decided that leveraging established, standardized designs is inappropriate. This decision, in turn, has begotten a decision that Amazon will create its own integrated cloud environment incorporating hardware components designed to its own specifications.

And the examples are numerous – custom storage, custom networking, their own fiber, their own power stations, and their own chips.  Sound familiar?  In some ways Amazon and Apple are more similar than they appear on the surface.  When they decide to address a customer’s real needs, they go deep in what can broadly be called “design” of the product or service…

 

 

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