amazon web services swot & competitor analysis

Date: 10/30/13 Prepared by: Bessie Chu

Agenda •  Introduction of Cloud Computing •  Amazon Web Services Business Model •  AWS SWOT Analysis •  Competitor Landscape •  Competitor Analysis using SWOT Analysis – Rackspace – Google Compute Engine – Microsoft Azure

•  Summary

What is Cloud Computing?

Cloud computing distributes computing over a network as a practice. Applications run on a large number of computers at a time remotely versus just your machine.

Business Model and Figures

AWS offers cloud computing services, what most people would understand as website hosting.

Selling point: You only pay as much as you need the services and Amazon does a lot of the heavy lifting so you can work on your core

business.

$3 billion out of $61 billion in revenue

Current capacity is five ,mes combined

capacity of next 14 rivals

Strengths

1. First market entry in 2006

2. Infrastructure of Dozens of Services

3. Large Entrenched Client

Base

4. Capacity 5X Combined that of 14 Compe,tors

5. Higher Investment than Business Rivals

Weaknesses

1. Public Cloud Business Only

2. Outages

3. Complexity for Customers

4. Price and Service Breadth

5. Profitability QuesFons

Opportunities 1.   Growing market for big business-‐ cloud computing a

$300 billion dollar a year business

2.   File storage costs less in the cloud with lowering prices so businesses want to move to the cloud

3.   Growing suite of products and services that that complement AWS

4.   Possibility of spinning off into own business

5.   Continued investments and expansions

Threats 1.Hardware

Pricing

Price Wars on Services

Enables Competing Services

2. Competitors

Niche Players

Google/Microsoft/IBM

3. Private Cloud

NSA Anxiety and Privacy

Customization

4. Database Trends

Trends Toward NoSQL/

Nonrelational Databases

Cloud Infrastructure Investment Landscape

Source: Gartner Research

hJp://readwrite.com/2013/08/21/gartner-‐aws-‐now-‐5-‐Fmes-‐the-‐size-‐of-‐other-‐cloud-‐vendors-‐combined

Most Similar to Amazon Web Services Product Mix and Target Clients

Rackspace Market Cap: 7.36 Billion

1.3 Billion in Revenue

Estimated 900+ Employees

Amazon Market Cap: $164.04 Billion

AWS 3 Billion in Revenue

Estimated 2000+ AWS Employees

Rackspace’s Current Position

Strengths 1.  Hybrid Cloud and Private

Cloud Businesses 2.  Non-‐Proprietary Cloud

Open Stack 3.  CustomizaFon and

Customer Service

Weaknesses 1.  It has to make money

AWS/Amazon doesn’t 2.  It’s not Amazon at

Enterprise level 3.  Outages, Security, and

Infrastructure

Amazon should diversify from Public Cloud, continue to strengthen infrastructure, and support periphery vendors that help businesses.

Rackspace Prospects

Trend to Private Cloud

Appeal of OpenCloud

Huge Market ($300 billion dollar industry)

Only business is Cloud Computing, chance to be agile

Opportunities Amazon Price Wars

Amazon’s Unrelenting Advance and Investments

Too Much Trying to Copy AWS

Google and Microsoft could make move

Threats

AWS should pay attention to trends and continue to pummel with resources

Looming Dark Horses

*Both do not yet act nor are perceived as full service cloud vendors in the way and at the scale AWS or Rackspace does

in the industry

Google Compute Engine

AWS Must Solidify Market Position as Full Service Cloud Service and Deploy Knowledge from Previous Analytics and Success Stories.

Strengths:

1. Google Network

2. Instance Flexibility

3. Incremental Billing

Weaknesses:

1. Google Perceived as Tone-‐deaf to Enterprise Needs

2. Features and Customer Service Ethos

OpportuniFes

1. Google’s ExperFse in Other Areas

2. Space for DifferenFaFon

Threats

1. Long Way to Catch up

2. Dismissed as Too LiJle Too Late

• Just announced this year. • Positioning itself as a full-‐service Public Cloud Competitor

Google Market Cap: $339.17 Billion

Cloud Revenue $200 Million in Q2

Amazon Stock Price: $332.54


Windows Azure

Strengths: 1. IntegraFon with Back Office IT

ApplicaFons 2. Legacy Provider with .NET and Other

Language Support

Weakness: 1. Amazon Had Three Year Head Start 2. Brand Weakness-‐ Not Seen as an InnovaFve Player

Opportuni,es: 1. One Step Expansion from Enterprise

Space 2. Appear to be also Stepping into Hybrid

Cloud Business

Threats: 1. Perceived as a Lock-‐In Trap 2. Opacity to Engineers Who Don’t use

Microsoc Heavy Languages 3. Can it Respond to Price War?

MicrosoX Market Cap: $296.94 Billion

$1 billion in Cloud Revenue, including Azure

Amazon Market Cap: $164.04 Billion


AWS Should Partner with Services or Expand Infrastructure to Integrate Better with Microsoft Enterprise Systems

Amazon Must Not Grow Complacent Pursue Market Trends Relentlessly Price War Competitors to Knees Improve Coverage and Security Support Complementary Vendors

Summary •  First large entrant into cloud compuFng business •  Advantages lie in scale, infrastructure, and the vast resources of Amazon

•  Disadvantages include changing industry trends and new large players, but Amazon appears to be paying aJenFon

•  CompeFtors are a threat because of parFcular aJributes, such as ease of integraFon, associated with each brand –  Rackspace –  Google Compute Engine – Microsoc Azure

•  Biggest threat is complacency

Questions?

amazon web services swot & competitor analysis

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