Amazon Web Services CEO: We’re a $30b revenue business in the ‘early stages’

https://www.cnbc.com/2019/02/28/amazon-cloud-ceo-we-have-a-30-billion-run-rate-in-our-early-stages.html

by bovermyer • 7 years ago

114 83 7 years ago

nakodari• 7 years ago

I really wish they reduce their public bandwidth cost to half. It will make such a major impact on the internet as a whole that we will see lots of companies grow faster and newer video heavy apps launching.

fooker5• 7 years ago

Why do you think they have the margins to afford this?

tw042• 7 years ago

What do you mean? Their bandwidth charges currently would be considered egregious for even a medium sized company. Someone the size of Amazon has obviously negotiated far, far lower peering rates than that. The only reason their outbound prices are so high is to keep people from getting out in a cost effective manner. They want to make customers think long and hard before leaving.

mrep• 7 years ago

Their gross margin is over 20% according to their public reports and their networking margin is about 90% according to the AWS network engineer I talked to last year so I think they could afford it.

speeq3• 7 years ago

Here's a few ideas to start a video heavy app on a budget:

You could store files in a Backblaze B2 bucket and serve them via Cloudflare with zero bandwidth fees. Or try DigitalOcean's Spaces offering with their built-in CDN at $0.01/GB for bandwidth.

Hardware video encoding could be done using cheap Hetzner servers that include GTX 1080 GPU's (lookup NVENC) or try Intel Quick Sync encoding (perhaps using OVH's overclocked i7-7700K CPU's).

desdiv• 7 years ago

You could store files in a Backblaze B2 bucket and serve them via Cloudflare with zero bandwidth fees.

From Cloudflare's TOS [0]:

2.8 Limitation on Non-HTML Caching
The Service is offered primarily as a platform to cache and serve web pages and websites. Unless explicitly included as a part of a Paid Service purchased by you, you agree to use the Service solely for the purpose of serving web pages as viewed through a web browser or other application and the Hypertext Markup Language (HTML) protocol or other equivalent technology. Use of the Service for the storage or caching of video (unless purchased separately as a Paid Service) or a disproportionate percentage of pictures, audio files, or other non-HTML content, is prohibited.

Of course Cloudflare offers commercial plans that feature video CDN, but it will cost you and it will cost you similarly to other video CDN providers.

[0] https://www.cloudflare.com/terms/

mciancia• 7 years ago

Using Backblaze which is only in US and Hetzner which is only in EU might not be the best idea, you might have issues with networking between locations.

amelius• 7 years ago

Is YouTube still operating at a loss? If so, then don't expect video distribution to be cheap.

reallydude3• 7 years ago

Depends on how you want to measure revenue. YT itself is a massive cash hole. It's the advertising that carries it. YT Red (and other types of paid service) are bumps in the economic redline.

"Google has never revealed YouTube's revenue" but you can quantify it (roughly) from known values and costs.

Ultimately profitability of a product within Alphabet depends on how you want to categorize technology within Alphabet. DFP and YT, at the very least, are separate products.

jimrandomh• 7 years ago

They probably weren't ever operating at a loss. There were some stories speculating about YouTube's costs a few years back, but they were based on market prices for hosting which would be much, much higher than Google's internal costs.

asien• 7 years ago

Strongly Agree with Andy in that interview.

In U.S , one way or another everything is running in the cloud.

For Europe ? It’s more complicated , most large businesses still have their own datacenters or run using dedicated machine with European hosting (OVH).

I’ve worked for many differents banks and they barely use the cloud compared to startups like N26 or Revolut.

Same thing for Industries or Health Services they largely run « On Premise » compared to U.S equivalent.

There is still room for growth from Europe if they manage to convince leaders of large corporations that the cloud will not take the their sovereignty away from them .

angarg12• 7 years ago

I've worked as a consultant in Germany and I was shocked by how far behind your average company is regarding cloud adoption. Modern tools and processes are also usually a pipe dream. So I agree, the industry as a whole has way more room to grow than you would suspect.

Thaxll• 7 years ago

Europe is the next big cloud customer since they're always behind US for tech adoption.

noir_lord2• 7 years ago

Always is a strong word.

France had usable networked computers everywhere long before the us did (it was called minitel)

Over on the UK my local Telco (not BT) was doing video on demand over copper ~2000, they where also one of the first to switch a fully packet switched internal backbone (so successfully other telcos came to look at how they did it).

We had chip and pin a decade before the US.

Our median internet connection is better.

Is the US the world leader sure, always ahead..not so much.

syn0byte• 7 years ago

But it does and it will take away an amount of sovereignty. "Excuse me AWS, Can you send me every hard drive used in the storage of Dataset X? Not copies, the original drives. I need to destroy all the drives per regulations." GDPR muddies the waters too. If AWS is the cause of a fuck up and a bucket is accessible on the internet, good luck proving your company shouldn't be saddled with the GDPR fine. AWS will have the technical means, monetary incentive and reputational impunity to claim it was your own fault.

Then there is the fact that a decade on the numbers are in; Cloud isn't any cheaper at the scale of most established businesses AWS wants to court. Often it's more expensive.

None of this will actually slow adoption. It probably should, but it won't.

ttul• 7 years ago

Makes you wonder if one day AWS will overtake its parent.

reallydude3• 7 years ago

AWS carried Amazon out of mediocrity in 2008. It accounts for something like 70% of operating revenue. What does 'overtake' mean?

gergi• 7 years ago

I'm not sure how Amazon was mediocre by any measure in 2008 but your second statement is incorrect - AWS only accounts for ~10% of Amazon's revenue. https://venturebeat.com/2019/01/31/amazon-earnings-q4-2018/

riku_iki• 7 years ago

5B out of total 60B for last Q = 8%, not 70%.

kennydude• 7 years ago

Maybe they can get half of their services to work properly then?

samstave• 7 years ago

I love AWS.

Some things that I think can still happen on AWS, if not already happening:

VPC Images!

Basically a VPC launch button that has a series of terraform/*form rules that deploy a SaaS-in-a-box:

Meaning, VPC images of infra to support a business case.

Want to start up an infra that can receive video uploads and display them on a portal? Click here.

etc...

stunt3• 7 years ago

The first item in my wish list is a better and more intuitive Cloudformation.

So much busy work they’ve created around their platform.

staticassertion• 7 years ago

Check out aws-cdk ?

NathanKP3• 7 years ago

This is the AWS Cloud Development Kit. It is still under very active development, so keep that in mind as a caveat, but it provides a much higher level, much more simple and intuitive way to define cloud infrastructure as code in your favorite languages: https://github.com/awslabs/aws-cdk

For context I've been able to take thousands of lines of CloudFormation YAML and replace it with around 500 lines of much clearer and easier to read JavaScript. And that 500 lines automatically builds five Lambda functions, builds, pushes, and launches two Docker images that run in AWS Fargate, configures an API Gateway and a CloudFront distribution.

CDK is really a game changer in terms of allowing developers to take an idea and turn it into infrastructure as code extremely quickly and properly (CDK automatically generates many best practices like minimal IAM roles, minimal security group settings, etc)

bradhe• 7 years ago

You need the AWS Marketplace my dude!

davidjnelson3• 7 years ago

Have you tried codestar? It's the closest thing to what you're describing that they offer as far as I know. It would definitely be great if they were specific to various application use cases instead of the more general purpose technology choices.

stunt3• 7 years ago

Unlike the old web hosting platfors, Cloud computing is becoming a big monopoly. Which is really bad for everyone.

We are in early stages and the monopoly will get worse.

Sumaso• 7 years ago

How are we even close to a monopoly? I could maybe see a oligopoly, but even though amazon is big, its not the whole market.

Eire_Banshee• 7 years ago

Its the only serious use case for enterprise.

What, you want to use azure?

fierro2• 7 years ago

It will likely never be a true monopoly. But an oligopoly with two or three players? That's where we are and where we'll remain.

bko• 7 years ago

It certainly has the potential to be a huge market. What barriers prevent others from entering?

Software? Does Amazon have have a monopoly on strong technical workers or patents? Not sure about the ladder, but certainly not the former.

Capital? Cloud hosting is probably capital intensive but there is plenty of interested parties with capital.

Legislation? Probably a lot lower barrier to entry than other industries, although I'm not sure.

It could just be that they are executing better than the others.

fierro2• 7 years ago

I think you severely underestimate what it means to run a public cloud business. "Probably capital intensive" betrays the naiveté of this comment.

Even if you have 100 billion dollars in the bank, you're years behind. Go buy land, build datacenters (5 year lead time), sign power contracts with utility providers, figure out where to buy all your dram and disk and networking and shit and oh develop your cloud services too. Now keep them running.

dleslie• 7 years ago

You could run a small business with an RPi and residential internet. That, and turn key solutions for websites and stores are probably bigger competition to colos and vps services.

pmart1232• 7 years ago

We could be. Edge computing though could be an interesting partial disruptor, or it could further entrench the leaders as AWS already has an edge computing package I believe.

appsonify• 7 years ago

If AWS gets Serverless right....and they are so far with Layers and Runtime API, they are in for a new golden era.

I know people have been on the edge about serverless in the past but it's now reached a point where I'm planning to actively employ them. 2019, will be the Year of Serverless methinks.

davidjnelson3• 7 years ago

It will be great when serverless aurora's data api can run sql queries at 5ms-ish latency instead of the current 200ms. Then lambda functions will be able to use sql in a performant way. For applications that need relational databases, fargate seems to still be the best option.

techntoke• 7 years ago

It is time for Kubernetes and other solutions to build a decentralized federated cloud offering.

Amazon Web Services CEO: We’re a $30b revenue business in the ‘early stages’

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