TECHNOLOGY AWS – The Jewel in Amazon’s Crown


Tech businesses have generally had a good pandemic and none more so than Amazon. Its share price rose almost 80% in 2020, profits are up across the board and it is expanding into new territories and offering new services on practically a daily basis.


things differently and that is the key to its success.


This is


understandable; Amazon is predominantly an online retailer and, with many high street retailers forced to close for much of the last year, people have got to buy their goods from somewhere. But there is one part of the business that is a stand out performer; it is responsible for just 12% of Amazon’s turnover and yet it delivers over 50% of its profits. That business is AWS, Amazon Web Services.


AWS is little known among consumers, but for millions of businesses and organisations around the globe it is a key supplier; for many it is a fundamental part of their operation. AWS provides cloud computing services for a huge range of organisations including software providers, online retailers, social media sites and public sector bodies. Most business software is cloud based now and even software that resides on computers such as Microsoft Office and Adobe Creative Suite relies on the cloud to download the software and provide updates. However, it is the plethora of websites offering everything from ecommerce to dating to financial services that make up most of the customer base for AWS.


At their most basic, cloud computing services comprise data storage and retrieval and remote processing services. This allows a piece of software that would normally be on your computer to do its thing on a server that might be thousands of miles away. The tech giants like Facebook and Google, big software companies such as Sage and Microsoft, big banks and public bodies like HMRC all have their own remote servers of course. However, this kind of IT infrastructure is hugely expensive so start-ups and SMEs simply can’t afford it; instead, they rent space on third party servers. There are lots of businesses other than AWS that provide remote server capacity and Amazon was far from the first to enter the market. However, AWS does


Normally, businesses rent a fixed amount of server capacity for a given time. This can prove expensive if they rent too much and cause operational problems if they rent too little. AWS uses


on demand pricing so customers only pay for the capacity they use. They have also invested hugely in their infrastructure so their customers always have all the capacity they need. Compare this with some software firms and even banks where customers struggle with sluggish software that regularly crashes, all because of a lack of inhouse server capacity. AWS servers are also very secure, more so than some banks and certainly more than many tech companies.


These days, cloud computing is about much more than just operating software remotely. Businesses expect their expensively acquired data to work hard for them. AWS provides a suite of products to support this including analytics, data mining and machine learning systems. These products are constantly being developed and give their customers the kind of capabilities enjoyed by Facebook and Google when it comes to deriving customer insight.


During the pandemic, the global digital economy has seen a breathtaking rate of change; it is estimated that ten years of development have been packed into just twelve months. This has provided huge opportunities for businesses of all shapes and sizes. Traditionally,


those


opportunities would have been reserved for businesses with the funding to take advantage of them. Thanks to organisations like AWS, they can be seized by any business with the agility and ambition to grasp them.


Jeff Bezos, the founder and CEO of Amazon, is stepping down this year. It should come as no surprise that his replacement is Andy Jassy who has headed up AWS since its formation in 2003. Based on his performance at AWS, Amazon will remain in good hands.


By Graham Iek 42 When responding to adverts please mention the ‘North Devon Insight’


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