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AWS and The Cloud Business

This week at the AWS re:Invent 2018, some interesting facts came out. Andy Jassey, Amazon’s cloud chief showed a chart of market share and it was quite revealing. AWS now commands 51.8% of the cloud market, followed by Microsoft at 13.3%. Alibaba is next at 4.6% followed by Google at 3.3%. Others like IBM and Oracle have much smaller market share. He said that AWS grew 46% this year and the next closest provider Microsoft’s cloud revenue grew by 76% although they don’t break it down. Andy said, “Because it’s so expensive to pay for these services in the cloud, it doesn’t take long for builders to know the difference and depth in these platforms”.

Andy wanted to tease Oracle by showing a picture of Larry Ellison staring at a tiny sliver in the market picture (Larry claimed how much Amazon uses Oracle database at the recent Oracle OpenWorld). He said, “These old guard databases like Oracle and SQL servers are expensive and not customer serving. People are sick of it and now they have choices”. Obviously he was marketing AWS Redshift and there is some exaggeration in his claims. Later Amazon’s CTO Werner Vogels claimed to have switched off Oracle data warehouse on November 1 and totally shifted everything to its own Redshift database. He also claimed that Amazon will completely remove Oracle database usage by 2020.

Some recent moves indicate how desperate are the competitors to fight AWS. Microsoft acquired Github for $7.5B while IBM recently acquired RedHart at a whopping $34B. Google removed its cloud chief Diane Green and replaced her with Thomas Kurian, the product chief from Oracle (worked there for 22 years). I was part of the recruiting process when Thomas had joined my team back in 1996 after his Stanford GSB. He started as a product manager for PL/SQL (I was head of product planning in the server group then) and rose through the ranks to head all of product development including Oracle’s cloud offerings. He is very talented and has a proven track record of product delivery. But Google’s problem is two-fold – it’s not taken seriously as an enterprise player yet and on top of it, as a serious cloud provider to fight AWS and Azure. They have great technology like Kubernetes and Tensorflow (machine learning) for developers. Thomas will have his hands full to steer Google’s cloud business to mainstream. They do have a run rate of $1B per quarter now. I wish him good luck.

AWS has a multi-year lead in the cloud business and they have steadily enriched the platform from a humble beginning in 2006 with S3 and EC2. Their triple database offerings (Aurora, Dynamo, and Redshift) try to cater to various customer needs from transaction processing to data warehousing in the cloud. Microsoft is aggressively moving to give AWS a fight. The rest have to make big moves to gain market share.

from: Jnan Dash’s Weblog
via Jnan Dash

Source: AWS and The Cloud Business Via Business Advice.

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