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Amazon Reports Surge in Profit

wsj.com

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Re: Amazon Reports Surge in Profit

#3

Post by gist »

AWS currently improves product and cuts prices. My feeling is that as they mature over time and get even more of a lock on the market (and their customers) with the obvious lock in they have that will reverse and prices will increase over time resulting in even more profit than they reported today. Impossible to think this won't happen, especially with the differentiation they have with their product as well as the FUD of changing to a marginally less expensive provider (who will probably follow suit).

Re: Amazon Reports Surge in Profit

#4

Post by brianwawok »

gist wrote: post #3

AWS currently improves product and cuts prices. My feeling is that as they mature over time and get even more of a lock on the market (and their customers) with the obvious lock in they have that will reverse and prices will increase over time resulting in even more profit than they reported today. Impossible to think this won't happen, especially with the differentiation they have with their product as well as the F…

Or another future - as more people see Google and Azure can compete... they build cloud agnostic software that treats providers as a utility, and profit margins fall and fall.

Re: Amazon Reports Surge in Profit

#7

Post by jeffasinger »

gist wrote: post #3

AWS currently improves product and cuts prices. My feeling is that as they mature over time and get even more of a lock on the market (and their customers) with the obvious lock in they have that will reverse and prices will increase over time resulting in even more profit than they reported today. Impossible to think this won't happen, especially with the differentiation they have with their product as well as the F…

One issue with this is the idea of competition from physical hardware.

At some price point, if the prices are too high, it will be cheaper to hire extra people, and get a cage in a few datacenters and some physical hardware.

Re: Amazon Reports Surge in Profit

#8

Post by mason55 »

brianwawok wrote: post #4
gist wrote: post #3

AWS currently improves product and cuts prices. My feeling is that as they mature over time and get even more of a lock on the market (and their customers) with the obvious lock in they have that will reverse and prices will increase over time resulting in even more profit than they reported today. Impossible to think this won't happen, especially with the differentiation they have with their product as well as the F…

Or another future - as more people see Google and Azure can compete... they build cloud agnostic software that treats providers as a utility, and profit margins fall and fall.

> they build cloud agnostic software that treats providers as a utility

It's like browsers all over again. As long as each provider is offering different things or different implementations of the same thing we will either need to choose one or be forced to go through a lowest common denominator translation layer.

MSFT, GOOG, and AMZN are all smart enough to not turn this into a race to the bottom of who can provide the cheapest scalable instances. They'll all try to differentiate on features and so it's going to be a long time until you can treat these as a utility.

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