AWS turns 10: A dominant market share, but does that tell the full story?

(c)iStock.com/RuthBlack

Today marks a notable milestone in the history of cloud computing, as Amazon Web Services (AWS) turns 10 years old.

March 14 2006 saw a press release go out on the wire from Amazon announcing “a simple storage service that offers software developers a highly scalable, reliable, and low-latency data storage infrastructure at very low costs.” A decade on, AWS continues to hold a significant lead over the competition in infrastructure as a service (IaaS), and while moving into other areas, such as gaming with Lumberyard, and virtual reality if a recent job posting is to be believed, its primary cloud operation shows no signs of stopping.

Werner Vogels, Amazon CTO, described a few of the various learnings AWS has provided over 10 years in a blog post. Building evolvable systems, expecting the unexpected – everything will fail over time, despite the best laid plans – and building software services for automation are all key, he argued.

“There are hundreds of lessons that we’ve learned about building and operating services that need to be secure, reliable, scalable, with predictable performance at the lowest possible cost,” he wrote. “With over a million active customers per month, who in turn may serve hundreds of millions of their own customers, there is no lack of opportunities to gain more experience and perhaps no better environment for continuous improvement in the way we serve our customers.”

James Hamilton, AWS senior principal engineer, moved to Amazon in 2008 after a “game changing” experience with AWS at his previous employer. Citing Netflix’s decision to go all-in on cloud in 2010 as key, Hamilton wrote: “The best proof of innovation is customer commitment and, without a doubt, the highest form of customer commitment is to decide to run the entire company on cloud infrastructure.”

So how does the rest of the industry see the history of AWS? Ian Moyse, a regular contributor to CloudTech and board member of Eurocloud and the Cloud Industry Forum, argues AWS has not only disrupted the landscape, it has dragged other companies – such as Microsoft – along with it more quickly than expected.

“In recent years AWS has really disrupted the cloud world, driving Microsoft into cloud deeper and quicker than they likely would have done and driving pricing down and functionality up in what has come to be known as the race to zero,” he said. “For providers and customers, AWS has driven more affordable compute, enabled innovation and empowered faster DevOps. Many apps we have today may not have existed if it were not for the change AWS has brought upon the IT sector.”

Research on the state of the cloud infrastructure market has not surprisingly seen AWS as the darling of the industry. Synergy Research offers a quarterly analysis of the market, and the current trend is that while other vendors, such as Microsoft and Google, are growing slightly quicker than Amazon year over year, it is hardly making a dent in Amazon’s 30% global market share.

Yet fellow analyst house Cloud Spectator argues AWS ranks comparatively poorly when compared to smaller, more niche players. “We see many smaller players find an advantage by offering high-performance infrastructure at a very competitive price,” CEO Kenny Li told CloudTech. “The [larger] providers offer the size and additional services for handling massive customer volume, but the volume also comes with additional performance considerations which may result in lower performance on cloud servers.”

For Moyse, the Cloud Spectator report represents one dynamic of the market, and that there’s room for vendors of all shapes and sizes. “A wide range of cloud providers will continue to be selected by customers, some offering local relationship to the smaller business and feeling the goliath brands leave them uncomfortable, some choosing for support reasons where they lack in-house skills in the new services and are unable to afford them against higher paying enterprises sapping the talent pool,” he said.

“AWS and Azure, whilst very attractive commercially and easy to spin up, do need some knowledge and experience to gain the outcome and quality businesses require,” Moyse added. “Much like Salesforce has done, we can expect a services ecosystem to develop around these platforms to advise and support smaller businesses in utilising them.”

Vogels argued there will inevitably be the occasional bump in the road. But, as he finished his missive, “remember it is still day one.” For AWS, the question now, with a burgeoning ecosystem, is whether the coming decade can be as successful as the first.