We Are Iterating At a Faster Clip, Says Amazon Web Services CEO

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“We have a pretty significant market segment leadership position in this infrastructure cloud computing space,” says AWS CEO Andy Jassy. “There are a few reasons for it. The first is we just have much more functionality by a large amount than anybody else. We are also iterating at a faster clip. When you actually look at the details that gap in functionality is widening.”

Andy Jassy, CEO of Amazon Web Services, discusses how AWS began as the leader in the infrastructure cloud computing space and how that gap in functionality is widening in an interview with Kara Swisher at the 2019 Code Conference:

In My Wildest Dreams, I Never Imagined a 6-Year Head Start

We were trying just to get to launch (2006) without our friends across the lake (Microsoft) knowing about it. At that time Amazon was not known as a technology provider to companies. We felt it was really important for us to be first to market to have a chance to be successful. I was hoping we could just get to launch without anybody else knowing and beating us to the market. In my wildest dreams, of the many surprises we had, I never imagined we would have a six-year head start. I don’t know exactly why others didn’t follow. I think for some of the older guard technology companies our model was very disruptive to their existing businesses. It’s really hard to cannibalize yourself.

I think they kind of wished it away (Oracle, IBM, etc.). It’s hard when you have an existing business that’s working it’s hard to cannibalize it with a product with a much lower margin. I think that some of the other players probably were distracted by some of the other things they were working on. Then their initial attempt at the business turned out to be the wrong abstraction. It turned out to be a higher abstraction when builders really wanted the individual building blocks to construct and stitch together however they saw fit.

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We Are Iterating At a Faster Clip

We have a pretty significant market segment leadership position in this infrastructure cloud computing space. There are a few reasons for it. The first is we just have much more functionality by a large amount than anybody else. We are also iterating at a faster clip. When you actually look at the details that gap in functionality is widening. That turns out to really matter if you’re an enterprise or a government who is going to move all their applications to the cloud. Or if you want to be able to unleash your builders to build anything they can imagine.

The second thing is we just have a much larger ecosystem of partners around our platform. It’s not just the thousands of systems integrators who build practices on AWS. Most ISVs and SAAS providers will adapt their software to work on one technology infrastructure platform, few will do two and hardly any will do three. They all start on AWS just because of our leadership position. You get to move to the cloud with a lot more of the software that you want to use.

The third thing that is pretty different is that we’re just at a different operating maturity than these other providers having been at six years longer. It turns out it’s really different running large scale infrastructure for yourself and your company where you get to tell everybody the way it’s going to be it is for running it for millions of external customers with every imaginal use case all over the world where they get to use you without any warning. It just forces a different kind of operating discipline and rigor. You can see that borne out in the operational performance.

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Microsoft Is the Clear Number Two Player Right Now

We are pretty early in this space right now. It the infrastructure technology space I don’t think there are going to be 25 winners because scale really matters. But there’s not going to be just one. The market segments that we address in infrastructure software, hardware, and data center services globally is trillions of dollars ultimately. There are going to be several successful players. I do believe that Microsoft will have a business there. They are building the business and they are the clear number two player at this point. I think there will be other players who are successful as well. As for Google, I think they are working at it.

In all of our businesses, there are startups that none of us know about today that have the ability to disrupt. If you think the technology changes in the last ten years have been disruptive, and I think they have been unbelievably dynamic, I think the next ten years is going to be faster than the last ten. There are all kinds of new technology that will evolve that will give people a chance to build businesses and pursue various segments. I don’t know exactly who they will be in our space, but I’m confident there will be.

We Are Iterating At a Faster Clip, Says Amazon Web Services CEO Andy Jassy





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