
How Amazon Swooped in to Own Cloud Services - drsilberman
http://www.bloomberg.com/news/articles/2015-04-22/how-amazon-swooped-in-to-own-cloud-services
======
skywhopper
I didn't remember the Sun initiative specifically, but it sure sounds like
they never got close to bringing anything to market. So I'm not sure if it's
fair to characterize Amazon's position of being the first to market by many
years as "swooping in". Amazon has essentially defined the category.

But I think the key to their success in something that ultimately ended up
being completely revolutionary was in starting small and unpretentiously. They
didn't promise that SQS or S3 or EC2 would change the world. They didn't offer
every feature imaginable up front. They grew their services piece by piece,
and layer by layer, and they continue to do so every year.

The biggest surprise to me was always that it took Google so long to get into
the same game.

~~~
ghshephard
Amazon was definitely not first to market - there were a large number of cloud
providers (Loudcloud being just one of them) that tried (and failed) to do
what Amazon eventually succeeded in doing. The idea was pretty similar though
- just build simple services that Customer Could build applications on top of.

Loudcloud had its first customers in 1999, 7 years prior to Amazon.

Totally agree with you - what Amazon did was start off small, and
unpretentiously, and just keep growing/iterating from there.

LDCL went the total opposite approach, spent 10s of millions of dollars (I
remember a time in 2001 when we were buying Sun E4500s like popcorn @$100K+
each) in the first couple years, hired 500 employees, opened up data centers
all over the world - and kind of fell down hard when the dot com market
imploded.

~~~
wtbob
I remember Lou Gerstner predicting the rise of utility computing way back in
2002[1]. It was a great idea, but IBM were simply unable to execute on it.

As far as I can tell, Amazon were the first firm to actually _execute_ and
deliver.

[1]
[http://newsoffice.mit.edu/2002/gerstner](http://newsoffice.mit.edu/2002/gerstner)

~~~
ghshephard
It's tricky - "Utility Computing" can mean many things to many people. I think
the subtle challenge is in understanding the difference between "Cloud
Services", "Hosted Services", "Web Hosting", "Professional Services", etc...

There were a lot of "Managed Web Hosting" companies back in 2000/2001, doing
quite well. Logictier, Sitesmith, Mimecom, Loudcloud were some of the big
ones.

What Loudcloud tried to do was provide a platform that other companies could
drop their application on top of. Loudcloud fought and struggled for the
longest time to keep the users from having root on their servers, and
installing whatever they wanted - until they finally gave up that battle, and
just let the customers have at it.

What LDCL never understood, (or, perhaps, it was just to early to deliver) is
that the real, amazing scale came from having simple services that are 100%
automated to procure, and then letting the customers procure and deploy those
services, and then _build their applications against those services_. That is,
provide scalable services, and let the _customers_ worry about how to scale
their applications to use them.

A lot of the early LDCL DNA came from AOL, where it was observed that every
time a business was placed on AOL, they would collapse under the flood of
traffic that came at them. As such, it was believed that most businesses
wouldn't know how to scale their system - but they could write their
functional code. So the division was, "You write the application, we'll scale
the rest" \- If I understand what they do, it feels like Heroku ended up
executing on LDCL's original vision.

LDCL, in some ways, executed well, but on the wrong vision (or, once again,
perhaps the timing was wrong). They wrote massive systems management/package
management software, that would allow people to deploy code, software, on a
large number of servers but never really got into the business of supplying
"cloud services" the way we think of them now.

Still, $1.6 Billon exit in 8 years on around $350mm raised - not too shabby.
And talk about your pivots...In the middle of an economic (web) collapse no
less. Ben Horowitz is quite the street fighter...

(More details here:
[http://www.bhorowitz.com/the_case_for_the_fat_startup](http://www.bhorowitz.com/the_case_for_the_fat_startup))

------
ioddly
Hah. I remember a very old interview with the founder of Slicehost. Said
something to the effect of it being very scary and odd that the internet books
giant was suddenly his competition.

~~~
Kalium
Slicehost did very well to sell to Rackspace when they did.

That person was probably Seats.

~~~
simonebrunozzi
Jason is brilliant.

~~~
Kalium
He is. He's also a lot of fun when you put him in the same environment as Nick
Longo for a couple of months.

------
erentz
Does anyone know how accurate the below is and are they talking VMs or
physical machines here?

"As of April 2015, DigitalOcean was the third largest hosting company in the
world backed by 154,000 Web-facing computers..."

~~~
arthurcolle
It is inconceivable to me that those are physical machines but with the new
investment I could be wrong.

[http://techcrunch.com/2014/03/06/digitalocean-
raises-37-mill...](http://techcrunch.com/2014/03/06/digitalocean-
raises-37-million-from-andreessen-horowitz/)

Edit: I missed the most recent round of investment. Looks like they've raised
roughly $90M in 2014. Impressive indeed

[http://www.forbes.com/sites/benkepes/2014/12/09/digitalocean...](http://www.forbes.com/sites/benkepes/2014/12/09/digitalocean-
raises-50m-but-even-that-cant-explain-the-growth/)

~~~
erentz
It's inconceivable to me too. Must be VMs which would make their physical
footprint pretty small.

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PaulHoule
Good observation.

Last summer I went to an AWS Summit in NYC and it was clear that AMZN was
trying to reach management-level people but was mostly getting techies. The
crowd was blatantly disappointed in Zocalo and the lines to get into the more
technical talks were incredibly long so I went to more of the business track
events.

------
MCRed
The bottom line is always about money. What's the money here? It's not the
money made from hosting, it's all about the P/E. Tech companies have high P/E
ratios. Retailers do not. Amazon is a retailer whose most successful product
has been its own stock. It has developed a skill in the art of propaganda to
make it seem like it's a tech company. The amazon Drone April Fools Hoax (that
people actually believe is real) is an example of this. They are working
really hard to create the perception that they are innovative so their
multiple can remain high.

I flagged this article because it is pure propaganda, self serving and right
out of the mouths of Amazon's PR staff. This is how they operate. This is how
a retailer whose management has no understanding of technology and who abuses
their engineers is made to be perceived as a "tech company". They have been
engaging in wall to wall propaganda for the past 10 years, using techniques
pioneered (and possible the same PR firms) by Microsoft when they wanted to
change Bill Gates from the perception that he was evil incarnate into the
perception that he was a good guy. (Which worked amazingly well. People seem
to have forgotten how he set back technology 10-20 years. Hell, 20 year olds
today were just being born during the height of his reign of terror.)

If this story about Sun is true, it shows just how much damage the US
government does to the economy with "regulation". But since there rest of the
article is nonsense who knows.

The claim that Amazon has a 7 year headstart is nonsense. The claim that
Amazon "turned cloud computing into a mainstream phenomenon" is nonsense.

By the way, Amazon's only service in 2006 was S3. They claimed (it was a lie,
and I know this because I worked at Amazon at the time and was amazed at the
boldness of the lie when I saw the press release) that S3 used "the same
machines that run Amazon.com!" Amazon didn't seek out to build a business with
cloud hosting-- this is just another initiative thrown against the wall to see
if it would stick. (Remember A9? Remember the literally 100+ businesses they
have launched and shuttered over the past decade? The Fire phone is an example
of this. They waste a lot of money just building crap to improve their image,
make them seem like a "Tech company") S3 was actually innovative-- shows what
can happen when management at Amazon takes their eyes off of the ball and lets
engineers have a little space. (unusual at that company.)

What amazon is good at is marketing and particularly to the Hacker News crowd,
I'm sorry to say. Objectively if you look at AWS it's a bad deal all around.
The technology isn't that great, it's terrible when it comes to reliability,
and the pricing is not very good either. Further, they lock you into their
APIs which means you have to spend a lot of effort to leave. Yet whenever
these things are pointed out here on HN, people say "yeah, but who has the
time or money to run their own servers!!11!".

As if they was the only alternative, as if there weren't lots of major
competitors from Google and Microsoft to Digital Ocean, Rackspace -- which
will give you even more high touch services-- and a million mom & pops. Every
feature in AWS was offered by somebody, at scale, before Amazon, and usually
without a proprietary wrapper around it. In fact, most of this stuff existed
in one form or another in the early 1990s.

Amazon only "Dominates" in the minds of the PR flacks who write these articles
and the proof is in the first sentence of the next paragraph: "On April 23,
Amazon plans to disclose the numbers for its cloud business for the first
time"

This whole thing is a shell game akin to the one Microsoft played in the 1990s
where they bought up all the media, and every writer out there whose audience
included CIOs and paid them to say that Microsoft had won, that Apple had no
market share, and by doing so persistently for several years (much like google
is doing now with android) they convinced people that Apple had less than %5
marketshare. This at a time when Apple had %25 market share! This killed many
software projects-- I remember being told "there's no market for our
application on the mac" during that era by marketing guys who knew nothing of
the real stats, only what they read.

Meanwhile people think android is winning based on ZERO sales data, merely a
constantly and loudly repeated propaganda making the claim. Apple publishes
audited actual sales numbers every quarter. No maker of android phones (that
I've found) does so.

If you think android is dominating in sales you're believing propaganda and
have no proof, and probably no evidence. (and don't get me started on
"activations". At one point Microsoft was "selling" and counting, windows for
every mac installed in every school!)

I see the down votes are coming in, I know to expect this because I'm daring
to criticize a "major tech company" that's often mentioned along with
Facebook, Google, Microsoft and Apple.

But my point is, we should not be so susceptible to propaganda.

This article is just pure propaganda.

~~~
quanticle
I downvoted you, but not for the reason you think. I feel like you made some
very good points re: AWS and Amazon's propaganda. However, the digs at Google
and Microsoft serve to dilute and undermine your point. If took those (IMHO
unnecessary) digressions out and focused more on Amazon and AWS, your comments
would be much more constructive and relevant.

~~~
MCRed
Those weren't unnecessary digs at Google and Microsoft. They were
illustrations to show how this technique works. Believe it or not, I was
trying got make it clear that I'm not just an Amazon basher, but that I'm
recognizing the broader use of it.

What I'm taking from your comment, is that your down vote comes from being
offended that I said something negative about something negative being done by
a company you care about.

I upvoted your comment, by the way, even though I think it's wrong, because it
was constructive, and illuminated your thinking to me, and I appreciate that.
My point was pretty well argued in my comment, and thus, even if you disagree
with it, I don't deserve a down vote.

The "down votes because I disagree" is literally saying "I want to silence
those I disagree with, rather than go thru the effort of rebutting them".
Literally on this site as you go negative, you go to lighter shades of grey,
and eventually disappear.

Voting was great for dealing with spam, but alas, it's become enforcement of
the ideological filter bubble.

~~~
simonebrunozzi
MCRed, I used to work at AWS too. It would be nice to get in touch. How can I
contact you?

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pgodzin
It says Azure is the only realistic competitor. What is Google's share of
cloud services?

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brooklyndude
By the time if reaches Bloomberg news, it's dinosaur time.

Check out CloudKit, or Digital Ocean. AWS is really showing it's age. It's now
just a Chinese List of confusing services, with just horrible documentation.
(IMHO).

It's Monday at AWS, lets see: OK, today lets add: Cloud Replications Across
Distributed Mobile Latency Image Systems Plugin Transient Architectures!

Great, throw up a link!

I'm sure that's what they are doing. Their services seem very similar to the
Bullshit generator. Kind of spooky :-)

Damn, I just lost my: Amazon Elastic Transcoder! Holy shit, now what? OMG :-)

Just killed my AWS account, and this is what they sent:

This e-mail confirms that you have cancelled your access to AWS Unified
Registration. Your access to following services is canceled: Amazon Simple
Storage Service Amazon Elastic Compute Cloud Amazon Simple Queue Service
Amazon SimpleDB Amazon CloudFront Amazon RDS Service Amazon Elastic MapReduce
AWS Import/Export Amazon Virtual Private Cloud Amazon CloudWatch Amazon Simple
Notification Service Amazon Simple Email Service AWS CloudFormation Amazon
Route 53 AWS Elastic Beanstalk AWS Direct Connect AWS Storage Gateway Amazon
ElastiCache Amazon CloudSearch Amazon Simple Workflow Service Amazon DynamoDB
Amazon Glacier Amazon Elastic Transcoder AWS Data Pipeline Amazon Redshift AWS
OpsWorks AWS CloudHSM URPProduct Amazon WorkSpaces Amazon AppStream Amazon
Kinesis Amazon Zocalo AmazonCloudWatch Amazon Cognito Amazon Mobile Analytics
AWS Directory Service AWS Key Management Service AWS Config AWS Lambda Amazon
EC2 Container Service AWS CodeDeploy Amazon Machine Learning Amazon WorkDocs

~~~
ceejayoz
Their having a wide variety of closely integrated managed services is
precisely what made them so successful, IMO.

Want static file store on Digital Ocean? You'll probably wind up using S3.
Want a load balancer? Have to build one yourself with HAProxy (and deal with
failover somehow). Want a managed database, queueing service, etc.? Nope.

