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Isn't the war between AWS, Google, and Azure etc just a race to the bottom? Won't these businesses just be complete commodities in the near future?

by arzt 10y ago

jjallen 10y ago
Have you seen AWS' margins? Are the dozens of APIs and services AWS offers commodities? Most take years to develop and test. Also a huge market with ~3 suppliers will likely not turn into a commodity business.
billmalarky 10y ago
AWS continues to add new products that support new technologies like Docker etc. They can stay out of "commodity" space by continuing to do so. Tech moves so fast it's hard to imagine them ever really running out of new products to build.
adventured 10y ago
That would have been true if AWS had remained a simplistic hardware-focused server renting type business. It's a software services business. Those rarely become commodities as a basic server business might. And once you have scale, your ability to sell your customers on an endless variety of new services becomes the real value, and that prevents the classic race to the bottom and it boosts customer lock-in dramatically. AWS, Azure, Google are not primarily competing on compute / ram / bandwidth cost any longer, that's increasingly a meaningless sideshow (which is why AWS is no longer aggressively price cutting / matching). They're competing on what software services they offer, how easy they are to use and scale, etc.
- lostcolony 10y ago
  This. There are other comments on this thread griping about the cost of bandwidth, and comparing it to competitors for EC2 (Linode and the like)...and that misses the point. If that's all you want, yeah, there are probably cheaper alternatives that might do. But for a one stop shop that offers the best selection of services from which to compose software solutions, mature and tested, with an aggressive roadmap for adding more...you're left with those three. And of them, AWS leads.

Isn't the war between AWS, Google, and Azure etc just a race to the bottom? Won't these businesses just be complete commodities in the near future?

by arzt 10y ago

Isn't the war between AWS, Google, and Azure etc just a race to the bottom? Won't these businesses just be complete commodities in the near future?

jjallen 10y ago

Have you seen AWS' margins? Are the dozens of APIs and services AWS offers commodities? Most take years to develop and test. Also a huge market with ~3 suppliers will likely not turn into a commodity business.

billmalarky 10y ago

AWS continues to add new products that support new technologies like Docker etc. They can stay out of "commodity" space by continuing to do so. Tech moves so fast it's hard to imagine them ever really running out of new products to build.

adventured 10y ago

That would have been true if AWS had remained a simplistic hardware-focused server renting type business. It's a software services business. Those rarely become commodities as a basic server business might. And once you have scale, your ability to sell your customers on an endless variety of new services becomes the real value, and that prevents the classic race to the bottom and it boosts customer lock-in dramatically. AWS, Azure, Google are not primarily competing on compute / ram / bandwidth cost any longer, that's increasingly a meaningless sideshow (which is why AWS is no longer aggressively price cutting / matching). They're competing on what software services they offer, how easy they are to use and scale, etc.

lostcolony 10y ago
This. There are other comments on this thread griping about the cost of bandwidth, and comparing it to competitors for EC2 (Linode and the like)...and that misses the point. If that's all you want, yeah, there are probably cheaper alternatives that might do. But for a one stop shop that offers the best selection of services from which to compose software solutions, mature and tested, with an aggressive roadmap for adding more...you're left with those three. And of them, AWS leads.