From the Computer Utility to Cloud Computing - To the Cloud: Big Data in a Turbulent World - page 49

the company's website. It operates several large data centers in the United
States, each of which contains multiple buildings with thousands of servers.
It also runs data centers outside the United States and has several under
construction. AWS is not the largest cloud provider in the United States by
quantitative measures such as size of data centers or total number of serv-
ers, but it is arguably the most powerful because it is part of the Amazon
corporate empire and the relationship marks one of the few times when
the often-used buzzword “synergy” is an understatement. AWS beneits
from the sheer size of its parent's computing power. For example, while
the parent Amazon does not reveal the size of its operations, an executive
who knows Amazon well maintains that just one of the company's data
facilities in the eastern half of the United States contains more servers
dedicated to cloud computing than does the entire operation of one of the
major hybrid-cloud companies, Rackspace, which in 2013 served 200,000
clients, mainly business customers, with about 100,000 servers in nine
data centers. AWS also beneits from the data that Amazon gathers on its
millions of customers whose purchases of topics, homeware, clothing, and
so on provide information that AWS uses to forecast consumer behavior,
a boost for both the parent and the irms that purchase AWS's services.
Among its major customers are popular media irms like Netlix, Pinterest,
Shazam, and Spotify. Amazon has been so successful in the cloud that
company management expects it to become the leading revenue producer
for Amazon, topping even its renowned retail division, with sustained
growth estimated at 45 percent per year through 2017 (Finkle 2012).
Market power gives Amazon considerable leverage over its competition,
large and small. As the head of AWS put it when asked about a stepped-
up challenge from Google, “We've always been very good at making
everything as low-cost as possible, then we lower it some more” (Miller
and Hardy 2013). The company is able to price its services, particularly
the storage and data-analysis capacity of its servers, so inexpensively that
neither many established nor start-up companies any longer bother invest-
ing in their own. Instagram, for example, the highly successful web photo
company, which is now a part of Facebook, did not bother investing in its
own computers. The start-up Cue, which admits to spending $100,000 a
month on AWS services, uses them to scan millions of emails, Facebook
postings, and corporate records to provide enhanced data that subscrib-
ers can use in all of their online activity. Over 185 federal government