
Investment Firm Expects AWS Will Hit $20 Billion In Revenues By 2020 - jamesjyu
http://techcrunch.com/2013/04/14/investment-firms-predict-aws-will-do-as-much-as-20-billion-in-revenues-by-2020-draining-it/
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vosper
A lot of people are saying the projecting out to 2020 is a ridiculous idea in
fast moving industries like tech. But there's already a cliche that when AWS
has an outage half of your favourite sites go down, and there's a reason for
that - there is NO serious alternative to the AWS platform. They're years
ahead of the little competition they have; no single other system does half of
the things that AWS can. The scale of the engineering effort required to
compete with AWS is enormous, and no-one's really trying it (except for
components, like CDNs or S3 substitutes).

So I don't think it's that ridiculous - I can imagine Amazon one day being
"that company that runs the internet, and also sells stuff".

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troymc
Who would you say are the main AWS competitors today (at least in part)?

This isn't my specialty, but I suppose the list includes Microsoft's Windows
Azure and the Google Cloud Platform. There are some open source efforts to
watch as well, including OpenStack (backed by Rackspace and others). No doubt
I've missed some.

There's plenty of time for those competitors to catch up to AWS by 2020.

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sgpl
>> There's plenty of time for those competitors to catch up to AWS by 2020.

Very true, but this fails to take into account that Amazon will not stay
stagnant till 2020 for competitors to catch up.

Because Amazon already have a healthy majority of the users/marketshare, they
are perhaps better positioned to understand and innovate upon the future needs
of these customers, and keep building their product offerings by anticipating
where the "puck is going to be."

With that said, nothing is set in stone, so competitors might as well overtake
AWS by 2020, but if I had to bet my money, I'd bet it on Amazon.

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venomsnake
Having majority of the marketshare in the marketplace is hardly the best
breeding ground for innovation. That is when companies usually stagnate and
entrench themselves.

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sgpl
I agree with you assessment, but as long as Jeff Bezos is able and leading the
company, I am willing to bet on Amazon's dominance in it's core markets.

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wallflower
> So one day Jeff Bezos issued a mandate. He's doing that all the time, of
> course, and people scramble like ants being pounded with a rubber mallet
> whenever it happens. But on one occasion -- back around 2002 I think, plus
> or minus a year -- he issued a mandate that was so out there, so huge and
> eye-bulgingly ponderous, that it made all of his other mandates look like
> unsolicited peer bonuses...

[https://plus.google.com/112678702228711889851/posts/eVeouesv...](https://plus.google.com/112678702228711889851/posts/eVeouesvaVX)

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NewAccnt
Since the writing of this post, AMZN has gone up ~150%.

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lostlogin
The relationship between share price and Amazon financial results has always
been a mystery to me. As are Apples.

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cmdkeen
Amazon's is based on an assumption that one day it will start to take profits,
and big ones at that. Expanding into a service sector where it could have
large profit margins (selling eBooks is another area) is integral to that.

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epoxyhockey
Predicting tech more than 2-3 years out is like predicting the weather 10 days
out.

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dyno12345
Predicting the weather is easier than that... weather is cyclical.

~~~
ShaneOG
Not in my part of the world! (Ireland)

Usually I bring sunglasses and an umbrella with me each morning, just in case.

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hkmurakami
For reference, Amazon's revenues in 2012 for the entirety of its business was
$51BB.

<http://ycharts.com/companies/AMZN/revenues>

Too bad we'll never know AWS's margins. It'd be a lot of fun to look at the
numbers for Amazon's product portfolio.

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CurtMonash
Amazon will probably have some very strong competitors. For starters, there
will be national-champion types, who will prosper due to geo-compliance issues
if nothing else. (I.e., rules restricting cross-border data transfer.) Other
security compliance will also matter, both pro- (strong enough security) and
anti- (government back doors). OpenStack is currently an Amazon fast follower,
but that's apt to change, with OpenStack getting some technical advantages as
well. And OpenStack is likely to maintain the very big advantage you can move
it among providers and hardware configurations, on-premise or off-.

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codex
One flaw with AWS-like businesses is lack of lock-in because of customer
churn.

Web site popularity on the Internet obeys a power law distribution--the top
sites take the lion's share of traffic and money from the Internet.

AWS will never see revenue from the post popular sites, because once a site
grows past a certain size, it's cheaper to build redudancy and host themselves
(Netflix, Facebook, etc.). AWS is actually fairly expensive for handling a
large stream of traffic--it's only for intermittent use or cash-poor sites
that the economics makes sense.

So AWS is full of very small to medium size operations, which are constantly
popping in and out of existence. And when a small site pops into existence, it
has no legacy cloud APIs to support, and can go with whatever cloud provider
has the best offering at that time.

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anizan
Another way to put it. AWS will require $50 Billion in Investments By 2020.
Profit potential uncertain. Shareholders not worried.

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niggler
"The estimates reflect Wall Street’s growing confidence in cloud services"

Seems silly to assume that Amazon will take the cake. By 2020 other offerings
like Windows Azure may end up taking away the lion's share of profits.

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NewAccnt
I seriously doubt this. Unintuitively, I think it's more likely that niche
cloud services with specialized features will be able to compete better by
exploiting industry-specific economies of scale that Amazon can't by being so
generalized. Any of these companies that resist a buyout will have huge profit
margins like Amazon doesn't.

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OGinparadise
_Investment Firm Expects AWS Will Hit $20 Billion In Revenues By 2020_

I expect that Investment Firms Will Keep Making Ridiculous Predictions Even In
2020 And Beyond.

Tech predictions on what will happen 7 years from now in a hotly contested
field?

