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Amazon Reports Surge in Profit

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Re: Amazon Reports Surge in Profit

#11

Post by bookmarkacc »

jeffasinger wrote: post #7
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.

The problem is people who arent big enough to have a whole data center. Or dont have the upfront capital even if its benefital in the longterm. They will still rely on Amazon.

Re: Amazon Reports Surge in Profit

#12

Post by Johnny555 »

bookmarkacc wrote: post #11
jeffasinger wrote: post #7

Earlier quoted context omitted.

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.

The problem is people who arent big enough to have a whole data center. Or dont have the upfront capital even if its benefital in the longterm. They will still rely on Amazon.

You don't need to own a whole datacenter to own machines located in a datacenter, my company keeps machines in a 4 rack cage in a datacenter. (and plans to empty that cage by the time our contract runs out in September to finish the migration to AWS). Our AWS bill is just a bit higher than what we were paying for the cage rental + internet connectivity alone.

Re: Amazon Reports Surge in Profit

#14

Post by jonhohle »

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 significant advantage of AWS is that they have a very large, built-in retail customer with relatively demanding requirements. I've always been under the impression that Microsoft doesn't really have a business that would lend itself to consuming its own services[0] and it's unclear to me whether or not Google uses their stuff internally.

0 - as an anecdote, I recall their salesmen coming to sell my employer their caching solution around 2008. I asked the rep I'd Microsoft was using their caching product on any of Microsofts web properties and he replied that they were not.

Re: Amazon Reports Surge in Profit

#16

Post by r00fus »

DasIch wrote: post #10

Is there any reason why Amazon would suddenly "waste" money on profit? Could this be an indication of a change in strategy or is this just a temporary thing?

Bezos will hold a press conference "We are sorry we did not realize we would make as much money as we did - consequently our spending just could not keep up" while AMZN tanks.

Re: Amazon Reports Surge in Profit

#18

Post by redorb »

honestly - stuffing video in with prime then raising the price. recently offering video stand alone but for $9 more a year than prime (with video)... Hard to tell who is actually shipping an item - sketchy pricing based on region / or account etc..

why trust them with aws? it seems their strategy is to price things stupid low - get you on board then raise it when they think they 'got you by the balls'

no thanks

Re: Amazon Reports Surge in Profit

#19

Post by Will_Do »

mason55 wrote: post #8
brianwawok wrote: post #4

Earlier quoted context omitted.

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…

I think you're right in that Amazon Machine Learning and Azure Machine Learning will never be drop-in replacements for eachother.

However, I would argue that VPSs are already drop-in replacements and I bet (though I have no proof) that VPSs are the majority of the market. The cloud providers may not have a viable way to provide even the perception of vendor lock-in when it comes to VPSs.

Now it could be that prices and profits stay high anyways as the market is an oligopoly. The U.S. has experienced the same thing with mobile operators. This is also far from obvious though because entrance barriers for VPSs don't seem steep.

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