Two separate pieces of research released this week have found its way to CloudTech HQ, and both have come to the same conclusion: Amazon Web Services (AWS) is miles ahead of the competition in terms of providing infrastructure as a service (IaaS) and platform as a service (PaaS) services.
This isn’t surprising in itself, but let’s not forget these companies Amazon is skinning are among the biggest on the planet.
Gartner’s latest Magic Quadrant, on IaaS, unsurprisingly put Amazon in its leaders category, well ahead of its competitors in both ability to execute and completeness of vision.
The analyst house cited AWS’ product portfolio and pricing structure in particular, and estimated that its operations are five times larger than a dozen of its major competitors combined.
Want more proof? Q2 data from the Synergy Research Group painted a similar picture, putting AWS’ quarterly revenue at over $600m, causing Synergy analyst John Disdale to proclaim Amazon as “in a league of its own”.
The bean counters calculated that Microsoft, Google and IBM’s combined quarterly score doesn’t even touch $400m in comparison. Total IaaS/PaaS revenues, according to the researchers, hit $2.25bn.
Actually, for two, make it three. The Talkin’ Cloud 100, reported by CloudTech earlier this week, did place Amazon behind Salesforce.com at number two, but that can, of course, be put down to Salesforce’s dominance in the much bigger software as a service (SaaS) market. In terms of IaaS and PaaS, Talkin’ Cloud puts AWS in the top slot too.
And, from this lookout post, this is going to be the status quo for a long while yet.
The case for the prosecution
The competition is hotting up – but only for second place. The marketplace can definitely do a 180 – as anybody who owned a BlackBerry a few years ago will testify – but in the cloud, there’s very little evidence so far to suggest anything else than AWS domination.
Disdale practically said as much. “The real race is to see if any of the chasing pack can establish themselves as a clear number two in the IaaS/PaaS market,” he noted.
“While IBM’s acquisition of SoftLayer helped it to leapfrog both Microsoft and Google, the three remain tightly bunched with somewhat similar growth trajectories.”
In fairness, this year’s prospects from Synergy are better than 2012, when Google/IBM/Microsoft didn’t even muster half of Amazon’s revenue between them.
And since then, it’s hard to imagine how they could have been more aggressive. Yet the growth isn’t especially pronounced. IBM in particular has been hoovering up companies, from big data analytics provider StoredIQ, to software delivery bods UrbanCode, not to mention Israel-based cyber security provider Trusteer just last week.
The big one, of course, is SoftLayer. Ranked #7 by Talkin’ Cloud, it certainly bolsters IBM’s attack in the midst of the battle between Big Blue, Bezos and the CIA.
To briefly recap: the CIA awards $600m federal cloud contract to Amazon; IBM protests; the Government Accountability Office (GAO) suggested the CIA reopen the competition because Amazon’s technical standards weren’t evaluated fairly; the CIA does just that; Amazon then fires off a lawsuit against the US Government, only made public this week.
The legal wranglings are just beginning, of course, but if and when a court rules that all’s fair in love and war, will IBM re-submit with a technical proposition stuffed with SoftLayer’s technology?
If that scenario does happen and IBM gains the contract, expect Amazon’s legal team to make like the proverbial rat up a drainpipe in firing off litigation.
Will that be a game changer? If Amazon gains the contract, the gap will be just as wide as ever, despite Big Blue’s acquisitions. Watch this space.
Going over to Redmond, Microsoft priced its Windows Azure Infrastructure Services with one target in mind. Its IaaS and PaaS virtual machines instantly dropped by up to a third, putting it equal with AWS.
Amazon’s response? Announce that its S3 cloud has two trillion objects in it. That ought to do it.
The elephant in the room, however, remains Google. Google Compute Engine was announced as available to all at Google I/O, with the key strength of its solution being speed between networks.
The search giant’s cloud roadmap isn’t quite as well-documented, although announcement of automatic encryption earlier this week is always good news, and as Barb Darrow wrote for GigaOM: “For those who still doubt Google’s commitment to cloud as a major business should remember, some folks also still call Amazon a book seller.”
It’s pretty safe to say too that, as Google’s cloud push blossoms, it’s not just going to be an inferior AWS clone looking to leech off its audience base – it’s going to be an innovative solution.
The case for the defence
So what evidence is there to suggest that not all’s as rosy as it seems in the Amazon garden?
Market forces could play a factor. If Amazon continues to lead for years to come, will it be considered anti-competitive, or just plain market dominance?
Amazon, of course, doesn’t even disclose its revenue figures. All this stuff, with the best will in the world, is educated guesswork at best. The thought that Bezos might be making more than is revealed, however, is a genuinely scary one.
The big money-making cloud market is in the enterprise. Given Amazon’s cloud structure is of a relatively small amount of data centres worldwide, there are potential latency issues to address. Would enterprises go with AWS, or a smaller vendor with data centres closer by?
There have always been niggling doubts about the Amazon SLA too. The various outages don’t help – although Microsoft and Google aren’t exactly innocent of all that themselves – with Gartner analyst Lydia Leong writing last year that AWS has the “worst SLA of any major cloud IaaS provider”.
And what for cloud’s perception overall? Gartner (yes, again), amidst its swathe of research recently published, also updated its hype cycle. Cloud computing has moved further into the ‘trough of disillusionment’, with a plateau of productivity still not expected for at least two years. Is now the wrong time for an aggressive play? Or is it necessary to simply keep up the pace?
Plenty of questions still to resolve, and it’ll be interesting to see how the Amazon/IBM federal war plays out, but for now, it’s hard to see anything top AWS anytime soon.
