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Amazon won't spin off AWS. That's hurting AWS
- bengale 7y ago> Apparently the whole bid process is now on hold, not because of anything AWS did wrong, but because, well, Jeff Bezos also owns the Washington Post, which Donald Trump does not appreciate, and so it’s all a mess. This isn't even Amazon's problem, I'm not sure what anyone is meant to do about the President of the USA being a petulant child, other than just take their lumps. Whole article is a bit odd tbh, doesn't seem like AWS is really struggling.
- 8ytecoder 7y agoYes, if AWS is losing out because a politician doesn't like the founder that's a failure of your country's democratic process and defies everything the US purports to stand for. Sure, spinning AWS might be the prudent thing to do from shareholder's point of view in the short term. But doing so, makes things extraordinarily hard for the very same shareholders in the medium to long term.
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- peteretep 7y ago+1 for Warren’s market-led idea of splitting the tech giants.
- scarface74 7y agoOf course everyone wants the government involved until it affects their company. More government involvement is seldom the right answer. It amazes me that even after we all witnessed the clusterf%%% of California trying to force Uber to treat drivers as employees — making it harder for people who wanted to be freelancers — that people still trust the competency of government.
- yoelo 7y agoWeird how you can consider this a "clusterf%%%" as opposed to the existance of Uber itself: an unprofitable company that only barters for monopoly power while treating everyone down the chain like shit. Not that I'm behind splitting up companies. Everything that turns into a monopoly should be nationalized instead.
- merpnderp 7y agoNationalizing monopolies? So instead of them eventually being replaced by the market, they are forever entombed by public unions, pork, and politicians where they'd go on like rotten zombies forever? That is a horrible idea.
- zozbot234 7y agoTemporary nationalization is a thing. Nationalize the monopoly firm, spin off the portions that are not inherently monopolistic and can be entrusted to the private sector, and run the rest - the "platform" part, where barriers to entry are inherently high and there's thus a lot of monopoly risk - as a public utility. You basically lose out on some potential for vertical integration, but the flip side is that the enterprise neatly escapes the fate of being "forever entombed by public unions, pork, and politicians where they'd go on like rotten zombies forever".
- scarface74 7y agoHow is being unprofitable different than every VC backed company - including ones backed by YC? Even Dropbox - one of only two YC backed companies to go public - isn’t profitable and has said repeatedly they have no idea when they will be profitable. I don’t know anything about PagerDuty. And what happens as soon as the other party wants to implement policy you don't like?
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- reallydontask 7y ago> Everything that turns into a monopoly should be nationalized instead. I don't think it even needs to be a monopoly there are services that makes no sense to have companies competing to provide them. Most utilities fall under this Don't get me started on water in the UK. It's private and you get no choice of supplier, how this is not a national scandal i don't know. At least with Gas/Electricity/Broadband (Excluding virgin from this) at least there is competition if delivered through the same means. More controversially, post/parcel delivery could likely benefit from being a single company IF run properly, big if, I know.
- allie1 7y agoIt'd be a good idea if the govt was consistent in their approach. They split off IE from Windows, but never used the same criteria for Google and Chrome, Google and Android and the like.
- acheron 7y agoMicrosoft didn't spend enough money on lobbying in the 90s, and so the government cracked down on them. "Nice browser you have there, shame if something happened to it." Google learned from MS's mistakes.
- WorldMaker 7y agoAlso the 90s were arguably the last time there was an anti-trust friendly majority in the US Supreme Court and various US attorneys general willing to try such a case. The Republican Party has put a lot of effort into removing trust busters from the Supreme Court and state attorneys general since the 90s.
- cnst 7y agoActually, they did; it just wasn't your government, so, you made little news out of it. Search terms: Google Yandex Android settlement https://techcrunch.com/2017/04/17/google-reaches-7-8-million-settlement-in-its-android-antitrust-case-in-russia/ https://techcrunch.com/2017/04/17/google-reaches-7-8-million... https://hn.algolia.com/?q=google+settlement+russia https://hn.algolia.com/?q=google+settlement+russia All the 4 posting didn't pass a score of 10 here on HN.
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- Jonnax 7y agoThis isn't convincing. Donald Trump doesn't like the Washington Post so it lost a contract and protestors interrupted a talk about AWS facial recognition. How will this be solved by spinning it off? The first is that he thinks a different CEO would be better and the second isn't going to change because AWS is a huge cloud company and people aren't stupid that they won't realise the name has changed. And it's known as Amazon Web services even if they rebranded to just AWS. It would be a stupid move to change such a strong brand name to something else.
- LoveKebabble 7y agoI actually think the OP is right, but not for the example they listed and not in a way that I directly care about or that impacts me (but would be better for Amazon). The fact that Amazon is also a retail shopping site / now owns whole foods causes a lot of high end/large retail giants to NOT use AWS and actively have in their contracts that they will not do business with a company if AWS is their cloud provider. There are exceptions, like if you stand up infrastructure specifically for the retail client that's against using AWS in another cloud instance (And I'm sure there are other exceptions out there). But this is something that negatively impacts Amazon / AWS. I think ultimately though that's a business decision that they are welcome to make for themselves and I don't think really impacts the end AWS user.
- scarface74 7y agoAnd yet Netflix is AWS’s largest customer even though Amazon has Prime Video. On another note, look how Apple both competes with Samsung and use Samsung parts for iPhones. The industry is all about co- optition
- noirbot 7y agoBut is Netflix an example of a company that's happy to be paying Amazon whatever they're paying them? I don't know the exact chronology, but I think Netflix pre-dates Amazon being in the Media business much, if at all? Netflix also don't really have an option, outside of building their own cloud, since Microsoft and Google also have video streaming. It's a little different if you're a Sears or Walmart, and you're not directly competing with the other providers. Same with Apple and Samsung. Sometimes you're stuck buying from competition because they're the only people making the thing you need. It doesn't mean you're happy about it or wouldn't jump ship if possible.
- bcrosby95 7y agoI wish they didn't lead with the Donald Trump argument. I feel like a lot of people are going to write off the article there. The rest of the points are much more solid if you can make it past that first flawed one.
- noirbot 7y agoI think the buried and more convincing point in there is that Bezos and Amazon's continued expansion into new markets mean there's more and more industries that feel threatened by Amazon, and thus more worried about funneling them money through AWS. If you're building out a new company right now and get to pick your cloud provider, how confident are you that in 5 years, Amazon won't be selling a competing product to yours? And if you're starting from nothing, why not just use GCP or Azure and avoid that risk?
- mwcampbell 7y agoGoogle and Microsoft also expand into new markets. To me, this is a good argument to use one of the smaller but growing players, like DigitalOcean.
- mc32 7y agoGoogle and esp MS are more limited in the imitation copy strategy risks. If you’ve got something compelling that they want, most likely they’ll buy you out. Amazon occasionally buys companies out too, but are also more likely to encroach on your turf. MS and Google tend to build (cooperative) “ecosystems”, Amazon less so.
- wbl 7y agoYou aren't avoiding the risk of Amazon deciding they want to compete.
- noirbot 7y agoThe folks talking about the JEDI/WaPo issues are missing the bigger concern, which is other retailers pushing down to their SaaS partners a hard message to get off of AWS. I've heard of multiple contracts that came with a clause of "If you're on AWS, we will only renew this if you're off in 2 years". That's a real problem for AWS, especially when Google and Azure are starting to really push into the space more, and AWS's legacy code/patterns/UX are starting to show their age a bit more.
- ses1984 7y agoWhy would a saas partner care so much if you're on aws?
- noirbot 7y agoIt's not the SaaS partner caring, it's Kroger going "We'll buy your SaaS product, but you better be off AWS in 2 years or we go somewhere else". I've heard first-hand of multiple contracts like this.
- unexpected 7y agohe's saying "other retailers pushing down to their partners". Other retailers (Target/Wal Mart/etc) won't work with companies that use AWS.
- falcolas 7y agoHere's a for-instance: Walmart cares because they don't want to give money to Amazon. They also don't trust everyone at AWS to keep their hands off Walmart's data if its stored in AWS. Now, we can argue encryption and principles of least access until we're blue in the face, but when it comes down to it, Walmart execs simply don't want their data on AWS if there are alternatives. And ultimately, that's all that matters.
- AJ007 7y agoThere are reasonable concerns about AWS from non-retail too. AWS is using proprietary cloud services to lock in customers. Future increases in AWS's prices will be passed down to the end users. I don't see it as so much AWS/Google Cloud/Azure is bad, but, did you build something which is impossible to decouple from. That is an upstream cost risk. If a customer can seamlessly move between their own datacenters, AWS, Google, Azure, and so on, that is a good thing.
- parvenu74 7y agoOh please... more of this JEDI/WaPo stuff? It ignores that the NSA (and by extension, the DOD) have a long relationship with Microsoft just as the CIA have a long relationship with Amazon and have "AWS-lite" installed at Langley. Microsoft has been very accommodating to the DOD, agreeing to continue maintenance on Windows XP for as long as the Navy continues to request (and pay for) it. Yes, Trump has his gripes with WaPo and might have suggested to Mattis to screw AWS, but it's very likely that the Five Sided Puzzle Palace wanted to go with Azure Stack all along but had to do the open competition thing to avoid being sued by companies not named Microsoft.
- 013a 7y agoYeah, its pretty crazy how the narrative has become "Trump is insane, AWS was going to win it until he stepped in." AWS fought very well, but Microsoft was destined to win no matter what they did, as long as they could check every box (or make promises that they will check them soon). You're hiring a new software engineer. You've got one candidate who's a bonafide genius, but young and can't communicate very well. You've got another candidate who seems to be within 80% of the skill level of the former, but came recommended by a trusted third party and can clearly communicate with the team. Which do you pick?
- buboard 7y agoThe argument sounds confused. People are not "confused" to protest about amazon in AWS conference, they are one. Companies trust AWS exactly because it's backed by the world's richest and apparently capable and trustworthy CEO. Them losing business because of that is just ... normal market functioning? There's no god-given right to AWS to dominate the market. Let the best ones overall, win.
- noirbot 7y agoI think the argument is that AWS would be a better player in the market if it wasn't directly owned by Amazon. They still get the benefit of having been built by all the money of Amazon, and they could still be owned by Bezos as a separate company, but they wouldn't be paying money into the co-mingled account/balance sheet with Amazon.
- buboard 7y ago> and they could still be owned by Bezos as a separate company But that's their whole 'competitive disadvantage'. WaPo and amazon are already separate. The fact that AWS would be separate on paper has very little gravity also.
- joecot 7y agoAWS runs ICE servers, and ICE uses AWS Rekognition as part of their crackdowns[1]. I was at the AWS NYC Keynote this year, and the protesters were very clear: "Cut ties with ICE!" Maybe AWS only has ICE contracts because of Amazon, but that seems unlikely. AWS pushes GovCloud hard, and therefore is going to make deals with US Government entities, and lots of those entities are extremely unpopular. I'm currently moving my personal tech off of AWS, and while it'll be a longer haul, I'll be doing the same for my workplace as I'm able to. https://www.technologyreview.com/s/612335/amazon-is-the-invisible-backbone-behind-ices-immigration-crackdown/ https://www.technologyreview.com/s/612335/amazon-is-the-invi...
- cnst 7y agoI agree it's a somewhat moot point, which didn't really click with me, either, as the argument assumes that these anti-ICE protests are carried out by non-engineers, which given the latest Chef and GitHub stories, isn't necessarily the case at all. Also, even in case of a spin-off, I don't really understand why would Jeff Bezos get out of the picture, either — wouldn't he remain the primary shareholder? Pretty much all of the arguments in the whole article are both invalid and unsound.
- growlist 7y agoNot sure I get the logic here. A spun-off AWS and Amazon's interests would naturally diverge over time. What's to stop a situation where AWS become another Oracle that Amazon seek to replace with their own self-built alternative? Couldn't (and why wouldn't) Amazon just start rebuilding AWS afresh?
- throwGuardian 7y agoAren't the activists happy about JEDI? They don't want AWS to serve American defense forces, so it looks like a win-win
- nidificate 7y agoEven if AWS was spunoff, surely it would still be owned by Bezos just as much? I assume in spin off proportional ownership by shareholders remains the same. I also don't see why their policies vis a vis government would be any different if they were a separate company. So, the argument comes down to people not being smart enough to realize AWS isn't any different as a separate company.
- cnst 7y ago> So with few exceptions, they are hedging their bets. They build on containers in a misplaced belief that will make quick migrations easier, they architect dubious “multi-cloud” workloads … the point is, they’re not using AWS the way it’s designed to be used, as a holistic, deeply integrated platform, and the looming shadow of Amazon is the reason why. And why is this bad, exactly? The fewer orgs use and depend exclusively on AWS, the better we'll all be as an industry. The whole idea that we'd take years of FLOSS work and stuck it into the black-box cloud which we can't control, is pretty absurd if you think about it. Here's a good article on the issues: https://www.gnu.org/philosophy/who-does-that-server-really-serve.en.html https://www.gnu.org/philosophy/who-does-that-server-really-s...