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Which AWS capabilities will withstand market saturation?

While AWS offers a slew of EC2 instance types and database options, the cloud provider may be reaching its technological limits on core services. So, where can AWS thrive in future years?

From iPhones to word processing software, consumers tend to want the latest versions of technology, even if there...

is only a nominal increase in the true value of the updates. As a cloud service provider, AWS offers core capabilities, such as storage and compute, which could be considered at feature saturation right now.

While AWS can lower prices and add new side features to its services, it seems we're nearing a tipping point for those AWS capabilities where the market is "tapped out" and updates begin to seem nominal. That means AWS could see less growth in a market that has been exploding for them over the last few years.

So, what's AWS to do? Pretty much what it's done all along, and that strategy should be no different than any other cloud service provider. All commodity cloud service providers need to possess these traits to see continued growth:

  • The ability to provide geographically diverse service access, meaning that enterprises can access compute and storage services from local points of presence around the world. This continues to be a common request from customers based outside of the U.S. In addition, the cloud provider must offer security and compliance services that are specific to the native country.
  • The ability to access purpose-built cloud services, such as high-performance compute services, and fast storage. Customers don't want this for all applications, considering that it is typically more expensive, but they want the availability to be there -- even if it's never used.
  • Provide other services that make its storage and compute services compelling. Amazon Identity and Access Management (IAM), for example, can be used in conjunction with the existing portfolio of AWS capabilities. Other options would include DevOps services, management services and a rapidly growing list of specialized services.

This does not mean that AWS can become complacent. Indeed, Google and Microsoft have been upping their IaaS games, with offerings that include very cost-effective compute and storage services. Still, cloud providers are missing many of the supporting services AWS offers, such as IAM with Google. However, it's only a matter of time before those providers improve those offerings.

What does this mean for core AWS users? As storage and compute continues to become a commodity, there may be opportunities to take advantage of non-AWS products for cost purposes. AWS understands, and will aggressively fight, to keep and expand its market share in the future.

Next Steps

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This was last published in January 2016

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How can AWS improve its storage and compute services?
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They are pretty far ahead with their serverless technology (Lambda) and the services around it.

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