Amazon Web Services is growing rapidly thanks to a virtuous circle — as it gains more customers there is greater server usage, this means AWS needs to build more infrastructure, which then leads to greater economies of scale, the company benefits from lower infrastructure costs, it reduces prices and this attracts even more customers. This virtuous cycle is currently in full motion, giving AWS a strategic advantage over others who were late to enter the market, said Andy Jassy in a keynote at the company’s first AWS re:Invent conference in Las Vegas. The company has lowered prices 23 times since launching cloud services in 2006 largely without competitive pressure to do so. The latest price cut: AWS is lowering its S3 cloud storage service by 25%.
Jassy said Amazon is injecting new energy into its virtuous circle flywheel by adding services/features and opening up to third party integrators, network solution providers and app vendors. This propels AWS forward to be the “infrastructure for innovation.”
Here is current snapshot of AWS
- 100s of thousands of customers using its cloud services
- Over 300 government agencies and 1,500 academic institutions
- AWS has introduced over 150 new cloud services or features during 2012
- Amazon’s S3 storage service is currently holding over 1.3 trillion objects and handling peak loads of 835,000 requests per second
- The Amazon Elastic Map Reduce service (Hadoop running on EC2) has now launched 3.7 million clusters
- In 2003, Amazon.com’s retail business generated $5.2 billion in revenue. Now, AWS adds enough server capacity every day to power the entire operations of the 2003 retail business
- AWS Global Infrastructure now encompasses 9 regions(US East, two US West coast, Europre, Brazil, Tokyo, Singapore, Sydney) 25 availability zones and 38 edge locations. There is as a separate U.S. government AWS cloud
Jassy’s keynote, along with partner presentations from NASA, Netflix, NASDAQ and SAP, is now on YouTube.