Amazon Focuses On New Services, Not Price - InformationWeek

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11/13/2014
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Amazon Focuses On New Services, Not Price

Amazon Web Services expands its menu, while dropping references to its leading price-cutter status.

its enterprise-minded features. With stiff competition from highly profitable competitors Google and Microsoft, Amazon, having logged a long string of money-losing quarters, is no longer talking about being the price leader of a commodity service. It's highlighting the rich feature set that it brings to enterprise users.

In the hallways of the Amazon conference, whiz-bang cloud technology is no longer the topic of discussion. Several observers said Amazon has hired enterprise-oriented product managers to shift its internal focus toward the increasing enterprise reliance on cloud computing.

Jassy reinforced the point, intentionally or otherwise, by saying shadow IT users were less and less frequently the source of new accounts at Amazon. New orders are coming in after questions from the CIO's office are answered by Amazon staffers, with CIOs themselves signing off on them, he said.

Philips and Major League Baseball appeared on stage because they're users of such privacy- and security-minded features as Virtual Private Cloud and Direct Connect, Amazon's private-line communications coming into its cloud centers through Equinix and other communications hubs. MLB is a user of Amazon's Redshift data warehouse and Kinesis streaming data capture and analytics.

Amazon used to emphasize a computer-literate clientele capable of self-provisioning themselves with servers. Now it's emphasizing an expanded feature set that, after self-provisioning, includes follow-on services such as Elastic Map Reduce, Elastic Load Balancer, and DynamoDB. At Re:Invent, AWS significantly expanded those services. Amazon will add 500 new services to its lineup by the end of the year, Jassy predicted. Some of them are minor, but they will soon include the following:

-- AWS Key Management service enables IT managers or developers to encrypt data with a click on the management console. Once data is encrypted, encryption key storage is an operational and security concern. Enterprises often end up with several key-storage procedures. The Amazon service promises a consistent, always available place to create, store, view, and disable keys, with activity touching them feeding a constant audit trail, Jassy said. Key storage is a sensitive issue, with some security advisers urging companies to never store their keys in the cloud. Amazon is trying to switch the advice around with secure key storage and rigidly consistent practices. The service makes it possible to integrate encryption into a customer's use of other Amazon services, such as Elastic Block Store, Redshift, or Relational Database Service.

-- AWS Config service brings Amazon into the territory of some of its ambitious third-party supporters, providing a comprehensive view of all AWS resources used by a single customer. With some customers using thousands of EC2 instances and related services, it has become harder to track accounts and maintain security and predictable billing. Third parties like Cloudyn, Cloudability, CloudHealth, and Cloud Checkr have tried to provide visibility into these concerns. Amazon appears to have studied the value of what they're doing in its market and decided to provide some of the same information itself. The service is now available in preview or non-product stage.

-- AWS Service Catalogue is a commonly requested feature by enterprises, Jassy said. It will offer a master catalog of what Amazon has to offer, so IT managers can make up a catalogue of services for use by their company's employees. That way, employees are self-provisioning servers with configurations already approved by IT. IT can also maintain control over who is allowed to use which products in the catalogue. It can limit how many times an application is used per month in order to maintain licensing compliance. AWS will log all product use via its CloudTrail API-use tracking, allowing IT to visualize usage and report on it. Service Catalogue will become available in the first quarter of 2015.

-- AWS CodeDeploy steps up AWS's commitment to DevOps operations for its customers. It is available immediately and provides a free and automated way to upgrade applications running on EC2. It can provide rolling updates across an application set. CodeDeploy "was born out of the experiences of Amazon's own developers, who saw the need for deployment tools that would let them deliver new functionality quickly, reliably, and at high scale," said Scott Wiltamuth, VP of developer productivity and tools for AWS, in a media release announcing the service. AWS developers use the tool to push 95 deployments a minute, he said. It works with open source tools such as GitHub, CircleCI, Atlassian, Codeship, Solano CI, and CloudBees (Jenkins continuous integration).

-- AWS CodePipeline, coming next year, will be an automated continuous delivery service to be used for integrating code into existing operations.

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Charles Babcock is an editor-at-large for InformationWeek and author of Management Strategies for the Cloud Revolution, a McGraw-Hill book. He is the former editor-in-chief of Digital News, former software editor of Computerworld and former technology editor of Interactive ... View Full Bio

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Charlie Babcock
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Charlie Babcock,
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11/17/2014 | 5:10:15 PM
Yes, but... no price rise on the foreseeable horizon
I agree, the cloud providers could be lowering prices in exchange for market share, and once that share is maxed out, they could raise prices. That's why we'll be better off than with multiple providers, more than Microsoft and its predicted Big Cloud Three of Amazon, Microsoft and Google. On the other hand, small suppliers can take advantage of the latest processor and memory gains, building them in from scratch and launching a new cloud with better price/performance. I don't think there's a big price rise on commodity services on the near-term horizon.   
GAProgrammer
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GAProgrammer,
User Rank: Ninja
11/14/2014 | 9:43:31 AM
1/10th of the cost - for now
Of course, the reality is that Amazon and other clouds providers are in a fierce price war right now. Sure, you can buy in and get these services on the cheap - for now. But what happens in 5 years when Amazon has starved out the competion and the stockholders start demanding returns on the millions (probably into billions by then) that they have put into this endeavor (see the CEO reversal of "services before profits" when he was called out by the shareholders)? Then, just like every other vendor out there, you are locked in and they have you hostage.

I'd say that you should enjoy the (nearly) free ride now, while you can, if you can afford the time spent to learn all this and put in the time/effort to make the move.
Charlie Babcock
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Charlie Babcock,
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11/13/2014 | 11:08:26 AM
Aurora is the nugget in the announcement
You're right, Doug. Aurora is the nugget in the announcement. A relational system designed for use in the cloud and taking advantage of the cloud's built-in software resilience is a potential competitor to Oracle and other proprietary vendors. Jassy said Amazon has been working on it for three years.
Whoopty
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Whoopty,
User Rank: Ninja
11/13/2014 | 10:10:51 AM
Trust issues?
Considering that a lot of US companies lost customers over the Edward Snowden reveals last year and Obama's continued push for surveillance, I'm quite impressed by Amazon's ability to keep drawing attention and new customers in. 

You'd think at this point everyone would be afraid of doing business with US based companies, but apparently not. 
D. Henschen
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D. Henschen,
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11/13/2014 | 9:46:35 AM
Aurora is the MySQL-compatible chestnut within this announcement
Many cloud practitioners whould much rather run cloud services, like the new Amazon Aurora alternative to MySQL, than running software on cloud infrastructure. The apporach lets them skip lots of messy administrative crap that they can leave to the service provider. Sure, you can get MySQL as a service in the cloud (including on AWS), but this is sure to be a cheaper and easier-to-deploy option through a single relationship with Amazon.

Customers probably also feel like they have a portability factor in that they could reverse-engineer their way into an on-premises DBMS deployment or MySQL on another cloud if required or desired, but I'd be wary of many tiny ways in which this database management service might lock you in.
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