
Amazon won't spin off AWS. That's too bad for AWS - forrestbrazeal
https://forrestbrazeal.com/2019/07/24/cloud-irregular-amazon-wont-spin-off-aws-and-thats-too-bad-for-aws/
======
dangus
What I read here is a bunch of stuff that Amazon doesn't care about.

So what if AWS doesn't get Walmart's business? e.g. are Walmart's suppliers
and vendors actually significant cloud infrastructure users? They're just
sellers of physical products that largely don't even have a significant web
presences.

The businesses Amazon wants to use AWS, SaaS startups, financial and insurance
businesses, healthcare companies, etc, they don't have any opinion about
Amazon owning some grocery stores and an online retail store. It's irrelevant.

What the article doesn't talk about is what Amazon as a whole gains from
_keeping_ AWS: a diversified, stable business, and a huge Internet empire that
runs on their own in-house technology.

In actuality, the article should be criticizing conglomerates like Sony and
Samsung in the same breath, but it's treating Amazon as if it's not in that
same category, when indeed it is.

Amazon competes in consumer electronics, retail shopping, cloud computing,
grocery stores, home security, social networks (Twitch), digital media,
pharmacies (PillPack), and probably many more.

Then you look at Samsung or Sony and it's the same kind of story. Samsung is
an extreme example, selling everything from insurance to hospital care to
computer chips, appliances, and phones. Sony sells game consoles, has a movie
studio, consumer electronics, professional A/V equipment, etc.

Why Amazon is not classified as a modern conglomerate is something of a
mystery to me. The whole idea of a conglomerate is that the diversity of
business leads to stability. Spinning off divisions left and right harms that
strategy if you ask me.

~~~
mywittyname
> Walmart's suppliers and vendors actually significant cloud infrastructure
> users?

You'd be surprised at the reach of Walmart. Some former colleagues of mine
left for a heavy equipment manufacture which has an IoT fleet management
solution. The company spent a solid 18 months migrating their platform to AWS,
then had to turn around and migrate to Azure after complaints from Walmart,
their largest customer.

Combine that influence with other retailers, and they make a solid business
case for companies to avoid AWS. If a company does any significant work in
retail, then their executive team is going to push against using AWS unless
they offer fair superior services.

FWIW, I'm staking my career on AWS, and I realize that this skill set will not
be transferable to a significant amount of the job market because retailers
dominate my area.

~~~
dangus
I don't doubt that this is true. I guess the complete ridiculousness of it
astounds me. Maybe that's why my initial reaction was to say "why should
Amazon spin it off to satisfy external interests?"

It seems totally unreasonable for someone like Walmart to make that demand. At
the same time I don't doubt they have that power.

It's like...if I worked for Sylvania, and I was told not to fly on the Boeing
777 because GE, the lightbulb competitor, made its engine.

------
mathattack
The idea that customers shun AWS due to Amazon is very real. Many retailers
won’t use it, and some are asking their SAaS providers to host elsewhere. Part
of the motivation is mistrust, part is just not funding a competitor.

------
Traster
There's a one thing about this that don't add up for me: the argument is that
AWS should separate from AMZN because AMZN is damaging AWS's brand. But the
example of WashPo is great! WashPo isn't owned by AMZN. It's owned by Jeff.
Amazon still gets it in the neck because of WashPo. If you spun off AWS that
wouldn't change - not unless you seriously expect Jeff Bezos to spin off AWS
and then sell off his interest in AWS - the most successful part of his
business empire.

------
m0llusk
Amazon probably can't spin off AWS at this point which should be a concern.
There is simply too much money and too big a share of the balance sheet
involved.

