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Definition: AWS

In the all-digital age, businesses need a fully online database and applications more than ever. From Netflix to Airbus, including Engie and Seloger.com, economic players from all sectors rely on a common service provider. Amazon Web Service, or AWS for short, brings together major brands and publicly traded companies, but does not exclude a large number of individuals either. Would you like to know more?

Amazon Web Service attracts businesses and democratizes the Cloud

Claiming leadership status in the field of online data storage and software, Amazon Web Services has been around for 15 years. Its reputation is based on perpetual research into better solutions to offer to cloud computing subscribers. Jeff Bezos’ group has been able to convince many players in the American economy, but it also winks at French, Swiss and rest of the world customers. The relevance of its offers has won over banks of the stature of Goldman Sachs, media such as Radio France, and even insurance companies like AXA. The AWS portfolio includes thousands of names, including CAC40 companies.

However, the mail order leader also offers its data centers to a wider audience. Amazon invites individuals to store their content on its powerful computers spread across several sites. This relocation of digitized memories offers many advantages. It is possible to save them in a lasting manner for a relatively affordable sum. Having your best photos classified in the clouds allows you to see them at any time. There is also certain software that can be accessed on demand. This service costs its price, but remains less expensive than installing an entire program with license and after-sales service. In addition, this tip avoids cluttering the PC’s hard drive with archives.

In 2000, AWS was the first to understand the challenge of data dematerialization. Taking advantage of the advent of high-speed Internet, his boss suggests various online services to users. After his success in the world of e-commerce, the “visionary” entrepreneur is launching into the cloud. Accessible remotely, the digital cloud frees you from heavy investments. It saves the cost of a local server as well as large capacity hard drives. Individuals and professionals, users also had the advantage of a large catalog of self-service IT tools. Some of the software offered has even been redesigned to remain easy to use and, above all, offer constantly updated features.

For the record, Amazon Web Service was born in 2003. At the time, Amazon already had a decade of experience in online sales. The site, which was a simple digital bookstore, became a leader in mass distribution via the Internet. For its own needs, the group had to design data storage centers and develop its software. Indeed, its activity requires speed and flexibility, which the applications of the millennium did not yet offer. The data areas represented a big investment for the company. It was from this observation that its founding president had the idea of ​​monetizing online IT services.

Optimization of data backup and other innovations

Since its creation, the Amazon subsidiary dedicated to digital services has continued to improve its services. At the very beginning, its offerings were aimed at small businesses as well as developers. To target a wider customer base, it had to offer basic tools as well as simplified online storage. To meet growing demand, hundreds of additional services have been created. In a decade, AWS has gone from database management to watching HD movies from a Smartphone. Above all, the subscriber has great ease in using the shelves of the largest digital hypermarket in the world.

AWS has made artificial intelligence (AI) its workhorse. Its cloud of data and software includes a host of tools that the average Internet user can try with ease. Originally, the applications developed internally or to order were intended for the group’s internal needs, but its manager found a way to make them accessible to his subscribers. In the 2000s, he looked for a way to deploy AI algorithms to individuals, but especially to businesses. The latter were entitled to inventory management programs. Purchase recommendation apps were also a hit among e-retailers when they were created. The idea was to offer another product to a customer who has just purchased an item.

With virtual assistants, Amazon has found a way to give a boost to its department dedicated to online services. Services can be controlled by the sound of the voice alone. Alexa is able to play music or read passages from a book. The connected speaker also provides on-board technologies for everyday people’s cars and offers various services. For professional customers, a wide range of specific tools such as bank card fraud detection have been developed.

A head start on competitors and a surprising customer portfolio

Amazon is an economic empire built on products and services accessible to a wider audience. While its competitors offer expensive software for large businesses and administrations, the group focuses on basic Internet users who mainly use their cell phones. Practical tools such as voice recognition or image analysis are among the featured offerings for individuals subscribing to AWS. For companies, the service extends to online purchase prediction software and applications against cybercrime. E-retailers in the VSE category appreciated programs that help them encourage their own customers to fill their baskets. These loyal subscribers form a real community. Nearly 65,000 subscribers and developers close to AWS were able to meet at the ReInvente conference in Las Vegas.

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Amazon Web Services is growing twice as fast as its main challenger. This serenity is partly based on a clientele made up of prestigious companies. AWS voluntarily cites that it counts Netflix and Unilever among its most loyal subscribers. Its services are so effective that the CIA, the specialized intelligence center for international files, signed with it in 2013. Brought to the attention of the general public, the agreement was a way of demonstrating the security and confidentiality of the servers of Amazon.

The end of Amazon’s years of reign is not yet coming soon. This company particularly benefits from periods of confinement due to the Coronavirus. In addition to online shopping, remote workers around the world also need the Cloud. The group is enjoying its good days, but some clouds hang over AWS. Strong competitors have emerged from the group of followers. JEDI no longer acts as a challenger among many others with a 10 billion dollar contract signed with the Pentagon. The American administration preferred Joint Enterprise Defense Infrastructure to Amazon servers. Motivated by the specific needs of the army and institutions, the agreement was ratified in October 2019. Microsoft is behind this attack within the rules. Bill Gates’ team was able to take advantage of the conflicting relations between Donald Trump and Jeff Bezos. The latter also returned to the charge by accusing the American president of having attacked his company publicly and behind the scenes in high political circles. The legal case is ongoing and seems to benefit the camp of Joe Biden, the current tenant of the White House.

A very competitive market for Cloud players

For now, JEDI is not yet a real adversary that can knock out AWS. Its $10 billion contract represents barely 4% of its annual turnover. That said, this blow reminds us that nothing is ever taken for granted in the world of digital business, especially for Cloud Computing players. This sector is experiencing growth of around +31% from 2017 according to the Gartner report. This opportunity has attracted newcomers, but Internet giants are also in the race. Microsoft and Google have recently accelerated the development of their offerings. They were thus able to increase their respective clienteles. Alibaba is also seeking to find a place with more than a billion Chinese to attract. Recent documents highlight a decline of 1.4% in AWS market share. It went from 49.4% to 48%.

Microsoft may give Amazon’s Internet services executives a run for their money. The Windows publisher manages to ride the current trends. It offers Hybrid Cloud (1) and Multicloud. The first part allows local servers to be associated with offshore storage. For the other configuration, the person uses several platforms. These operating methods appeal to companies seeking performance and who do not want to be dependent on a single service provider. Amazon tries to explain to them that mixing several trays reduces efficiency. The group insists that a 100% AWS solution ensures greater flexibility. This fixed idea cost him the loss of part of his market.

In December 2019, an additional threat darkened the skies over AWS. According to the specialized media Bloomberg, American law enforcement agencies responsible for observing competition suspect it of abusing its status as market leader. The Federal Trade Commission believes the company discriminates against partners who dare to work with other cloud computing solution providers. Remaining discreet on the subject, the same FTI is mandated by the American antitrust authorities to put pressure on large groups which may engage in abusive practices. She also has Google and Facebook in her sights.

AWS operations are profitable despite tough competition

AWS owes its growth to Andy Jassy. A 1997 Harvard graduate, he joined the group the same year and became an assistant to Jeff Bezos. He rose to the chair of CEO of Amazon Web Services when it was launched in 2006, he earned $25.7 billion for his parent company for 2018. Which represents approximately 10% of the number one’s total turnover. world of online sales. In 2019, Amazon took home $240 billion. During the same period, AWS’ operating profits reached $7.3 billion compared to $10.1 billion for all of the group’s activities.

Here are some figures for a better understanding of the Cloud issue

  • 32,441 billion dollars: this is the total weight of the market for data storage services and online applications. (Gartner, July 2019).
  • 47.8% of this financial windfall belongs to AWS, which remains the leader in its sector with an average annual revenue of $15,495 billion.
  • 15.5% of revenue goes to Microsoft, which earns $5.038 billion per year.
  • 7.7% are currently held by the Chinese Alibaba. The cloud brings in 2,499 billion for Jack Ma’s group.
  • 4% market share earned Google its fourth place in the ranking. This rank is equivalent to 1.314 billion greenbacks every year.

1.8%, or $577 million, is held by IBM, which almost made it into the top 5.

The growing sector that is the Cloud represents 20 companies out of 100 companies operating in the IT field.