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Note: ex-AWS employee The problem with the above narrative in this case (which I agree is generally true), is that's not what AWS did. If you look at the annou

Note: ex-AWS employee The problem with the above narrative in this case (which I agree is generally true), is that's not what AWS did. If you look at the announcement history shared in a sibling comment you'll see that so much of it happened long before the cloud wars really heated up. I find that particularly curious. Is that because margins used to be very very fat and AWS just trimmed them down as economies of scale allowed in an attempt to (unsuccessfully) stave off competition? Is it just coincidence that the system found a natural level of margin efficiency right around when competitive pressures started to ramp up? Something else? I have zero insight on why it has played out this way. I'd love to know though.

ericd 4y ago
Seems likely that the competitors they were trying to dig into were on-prem/leased machine incumbents more than the nascent cloud competitors, though? Trying to build the brand of "Cloud" as an alternative, to the point where now it's practically the default choice for big enterprise/government customers. They combined that with extremely aggressive credit packages to get startups while they were young, so they would adopt the various services rather than building out their own infra on bare metal and saving a bundle long term. Though making it harder for cloud competitors was certainly good for them as well. It's like with any startup, your biggest competitor is what people do currently, not necessarily another company, let alone another startup. For many software startups, the biggest competitor is something like pen and paper, excel, standard email, etc.
- glenngillen 4y ago
  Again I want to be clear that I have zero special insight on this based on my previous employment... I was at a startup that was an early and very large user of AWS. The alternatives for us at the time would have been companies like Rackspace and other innovative (at the time) colo type providers. AWS wasn't super competitive one a $/compute basis at that point, and the credits didn't last very long, but it was wwwaaayyyyy more flexible. Add in the incredible convenience of S3 relative to most other alternatives at the time and it was an easy, though not obviously cheap, option. The common narrative I hear though is it was the startup focus that won it for AWS. Everyone else was chasing the on-prem and enterprise market as you said. AWS went have startups, dangled some modest credits to make it happen, and they stuck around. The conventional wisdom was this is a terrible mistake. Enterprises pay the bills, startups go bust in an economic downturn (and we're coming out of a cycle at this point so companies are understandably nervous). Except those startups that AWS attracted turned into Netflix, Airbnb, Uber, Lyft, etc. and whole host of voracious consumers of infrastructure. The startups had become the enterprises. The competitors were _still_ trying to convince enterprises that cloud was safe enough to adopt. They belatedly realized they'd played the wrong game, tempted some of the not-so-startup-anymore companies across with more competitive pricing commitments, and finally the battle began. By this stage AWS had won most of the viable early adopters and used that as the beachhead to grow into the big enterprise and gov areas. At least that's the narrative I've been told a few times over the years, and it seems plausible and maps onto my own experience. Though all of that experience has been startups and not enterprise/gov so it's a very skewed perspective.

ericd 4y ago

Seems likely that the competitors they were trying to dig into were on-prem/leased machine incumbents more than the nascent cloud competitors, though? Trying to build the brand of "Cloud" as an alternative, to the point where now it's practically the default choice for big enterprise/government customers. They combined that with extremely aggressive credit packages to get startups while they were young, so they would adopt the various services rather than building out their own infra on bare metal and saving a bundle long term. Though making it harder for cloud competitors was certainly good for them as well. It's like with any startup, your biggest competitor is what people do currently, not necessarily another company, let alone another startup. For many software startups, the biggest competitor is something like pen and paper, excel, standard email, etc.

glenngillen 4y ago
Again I want to be clear that I have zero special insight on this based on my previous employment... I was at a startup that was an early and very large user of AWS. The alternatives for us at the time would have been companies like Rackspace and other innovative (at the time) colo type providers. AWS wasn't super competitive one a $/compute basis at that point, and the credits didn't last very long, but it was wwwaaayyyyy more flexible. Add in the incredible convenience of S3 relative to most other alternatives at the time and it was an easy, though not obviously cheap, option. The common narrative I hear though is it was the startup focus that won it for AWS. Everyone else was chasing the on-prem and enterprise market as you said. AWS went have startups, dangled some modest credits to make it happen, and they stuck around. The conventional wisdom was this is a terrible mistake. Enterprises pay the bills, startups go bust in an economic downturn (and we're coming out of a cycle at this point so companies are understandably nervous). Except those startups that AWS attracted turned into Netflix, Airbnb, Uber, Lyft, etc. and whole host of voracious consumers of infrastructure. The startups had become the enterprises. The competitors were _still_ trying to convince enterprises that cloud was safe enough to adopt. They belatedly realized they'd played the wrong game, tempted some of the not-so-startup-anymore companies across with more competitive pricing commitments, and finally the battle began. By this stage AWS had won most of the viable early adopters and used that as the beachhead to grow into the big enterprise and gov areas. At least that's the narrative I've been told a few times over the years, and it seems plausible and maps onto my own experience. Though all of that experience has been startups and not enterprise/gov so it's a very skewed perspective.