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agencies also run some part of their services through AWS and Amazon
has won a $600 million contract to provide cloud services for the CIA
(Babcock 2013a). The company is active internationally; in addition to
having data centers located in Asia, Europe, and Latin America, it hosts
numerous corporate and government clients outside the United States.
For example, a German company used AWS to make digital copies of
20,000 television shows, a job that cost the irm less than it would have
spent on the electricity alone if it had done the work in house. AWS servers
located in California and Ireland provide people in Africa with the ability
to comparison-shop cars using smartphones connected to AWS. There is
no gainsaying Amazon's rich database of customer searches and purchases,
which adds value to AWS's offerings. As one customer commented, “You
can now test a product against millions of users for just a few thousand
dollars, or start a company with just one or two people” (Hardy 2012a).
To multiply these success stories, Amazon has to successfully deal with
two major challenges: providing continuous reliable service and fending off
the competition. AWS has been a generally reliable cloud provider, but a
handful of notable outages have damaged the company's reputation. One
of the most signiicant took place over the Christmas holidays in 2012,
when Netlix customers lost access for the better part of Christmas Eve
and Amazon itself lost service for its own customers on Christmas Day.
In 2013 Netlix relied on Amazon for 95 percent of its data-center needs
and, in the highly competitive video-streaming marketplace, the com-
pany cannot tolerate signiicant downtime. As one independent analyst
concluded, “Netlix and other organizations which rely on AWS will have
to reexamine how they conigure their services and allocate their service
requirements across multiple providers to mitigate over-dependency and
risks” (Finkle 2012). Amazon is not alone in experiencing outages. They
affect the entire industry, are primarily caused by power problems, and, on
average, last for 7.5 hours (Talbot 2013). They also lead to unanticipated
consequences and hidden costs (Franck 2013).
Reliability also requires guarantees of security, another problem for
public cloud companies, and Amazon is no exception. In 2013, a single
security researcher managed to uncover 126 billion iles that were left
open to the public. From a sample of 40,000 iles, he found exposed data
belonging to a medium-sized social-media service, the sales records of a
car dealership, employee spread sheets, and video game source code from