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Why is AWS leading the market?

8/14/2024 | nmb@konfitech.com

AWS is the current market leader of the cloud infrastructure market. The reason AWS managed to gain the leader position was that AWS had the first mover advantage, launching in 2006, making great use of its parent company’s resources in logistics and e-commerce to build scalable and efficient data centres. The company already had great connections to businesses who ran on their platform and great API developers. Meaning that the adjacent skills were very close and easy to transfer onto developing the cloud platform.

From that point, they could scale and compound from early on the loyal customer base of AWS. Making the growth get more years of compound interest.

It also gave them the opportunity to hone their services, building a great breadth and depth. Allowing the flexibility that customers need to enable their businesses through applications and so on, but also a great variety of selection depending on the preferences of the client. AWS's extensive service offerings provide this flexibility.

Their cloud payment model is also pay-as-you-go. Making it very easy and attractive for clients to build IT infrastructure on AWS and only paying for what you’re using. The price point for the services has also been quite great for the clients. Amazon as a company has a great focus on scaling to reduce costs, which creates demand, which again scales. It is called the Amazon wheel. This focus on cost and scale has spilled over to the AWS business and helped existing clients get more value and making AWS more attractive for new customers looking for cost-effective solutions.

Also, as the outsourcing of services by nature is moving the control of a certain process out of your business it can create more risk. Which is why AWS has a big focus on security, both in terms of compliance and security standards, but also in terms of availability and uptime to ensure that the business never goes down.

The culture of Amazon is very data driven, which is the same for AWS. Focusing on reviewing data on a global scale to improve there. They also offer data analytics services internally in the customers tenant, this way the customer can monitor their assets within AWS and receive alerts for improvements.

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