Why computing cloud will keep growing and growing
JEFF Bezos of Amazon, along with a few of his rivals, may eventually control much of the $1 trillion global market for business computers and software.
That is because Amazon Web Services, his big-business computing division, is starting to affect more than just the world of computer servers, data storage and networking. Increasingly, it is also entangled with mobile phones, sensors and all sorts of other devices in the socalled Internet of Things.
It’s the same story at Microsoft Azure and Google Cloud Platform, the other two big cloud companies. Startups and corporations rent the core resources, instead of owning and running their own machines.
What’s next? As innovations like artificial intelligence and connected devices become popular, customers are putting cloud components in mobile computing, home games and email marketing campaigns. In other words, the big clouds aim to be everywhere.
“When has Amazon ever thought about anything other than world domination?” said Lydia Leong, who follows cloud computing at Gartner. Not content to be in big centralised data centres, she said, “they want to be at the edges, whether that is a customer’s own computers or the Internet of Things.”
This aim for domination was clear at Amazon’s big customer conference, called Re:Invent, which was held in Las Vegas this month. About 32,000 people went to the annual event.
In one talk at the conference, an Amazon Web Services executive showed off the company’s 1,400-kilometre undersea cable and spoke about this expansion.
In a nice bit of showmanship during the main keynote, Andy Jassy, the head of AWS, appeared onstage with an 18wheel truck carrying a device that could suck 100 petabytes of data out of a customer’s computers and put it in the Amazon cloud. That is equal to 2 billion filing cabinets of paper, which a surprising number of companies now possess in digital form.
It is easy to see why this matters to Amazon. In the third quarter, AWS had revenue of $13 billion a year, growing at 55 percent annually. AWS was 10 percent of Amazon’s revenue, but more than 100 percent of the company’s operating income. Amazon’s international retail business lost money, and US retail sales are nowhere near as profitable.
But Amazon is not alone in this business, and the competition is getting more intense. AWS now has 81 services, including ways to work on home video games. Microsoft’s 67 services include Internet of Things “hubs” and email marketing campaigns. Google has 53, including ways to deploy mobile software globally and steer performance with data analysis. Comparisons of services are difficult, as one company’s service may encompass two or three offered by another.
Machine learning – a method for computers to gain knowledge without being programmed with that information – is front and center for Alphabet’s Google, said Urs Hoelzle, the head of technical infrastructure at Google Compute. Google has recently shown off its own global network of submarine cables, along with local devices like cloud-connected office whiteboards. Over the next year, Hoelzle said, Google will open about one new Compute facility a month.