Conglomerates Didn’t Die, They Look Like Amazon

This is a persistent myth that needs to die, AWS was not built to host their websites, and indeed did not do so for many years after it was established.

AWS wasnt their "spare capacity" nor was it them exposing their internal systems to the world so they could sell them off, It was developed from day one as a public facing service.

Interestingly, the article suggested that Amazon, in being both the distributor and the cloud provider, may be able to increase their advantage by exploiting information they hold on competitors.

I don't think that's the right way to approach this.

AWS is like any other hosting provider that also happens to have one really large customer, Amazon the e-commerce company.

Now, a nuclear powerplant is not going to co-locate with a regular hosting provider because they do not need to move any of that data off-site and co-locating others on their network would mean co-locating those others on the far side of their firewall, or in some kind of DMZ. Nuclear power plants tend to concentrate on what is their main reason to exist: to produce power, not to get into the hosting business so for them it would make absolutely no sense to allow others on their networks, besides any security risks that might cause. You could even argue that the only safe way to connect a nuclear plant to the internet is 'not'. Airgap the thing and call it a day, don't even try to secure it. For Amazon this is - for obvious reasons - not an option.

So for Amazon the company the decision to create a web hosting service which then has their e-commerce arm as one of the tenants (each behind their own (virtual) firewall) is no different at all than Amazon the company buying their hosting from any other provider (Microsoft, Google, Rackspace and so on). They have to host somewhere, no matter what. In which case they have all of the downsides of the current situation and none of the upsides. The impression that you are on Amazon's internal network when you are co-locating with AWS is where things no longer align with how things work from what I know about their infrastructure, AWS allows the creation of VLANs for segregation purposes which is roughly the level of separation that you would expect of any multi-tenant network.

So in that sense Amazon is not less secure than any other corporate setup, the only way in which that sort of situation could lead to trouble is if you managed to find an exploit in the network stack (for instance: the firmware of a switch or router) that Amazon operates that would expose traffic from one tenant to another.

But I'm not aware that any such breach has ever happened, in theory it could happen but that goes for any other hosting provider as well.

What level of compartmentalization would you be comfortable with?

  Is there supposed to be something inherently
  not-fine with a conglomerate?

Some people think they have a tendency to be inefficient, as high-performing areas of the business waste money subsidising low-performing areas of the business. And low-performing areas are insulated from free market feedback, like going bankrupt or investors leaving.

Of course, some of this stuff is only obvious with hindsight. It was probably inefficient that Google Ads wasted money subsidising Plus and Wave; but probably efficient that Google Ads subsidises Gmail.

>Conglomerates Didn’t Die, They Look Like Amazon (nytimes.com)

More like all Japanese conglomerates look these days (Marubeni, Mizuho, Mitsui etc) Except, the topmost structure is not likely to be publicly traded.