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Amazon’s Customer Win Trinity: Startup, Enterprise, Big Data

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Amazon Web Services continues to lead the pack in cloud computing.

There’s been a flurry of cloud news in the past few months, including industry continued price cuts, heated debates around APIs, IBM buying SoftLayer, or upcoming cloud exchanges. Through it all, Amazon Web Services (AWS) continues to lead the pack, with staggering growth.

Amazon (AMZN) doesn’t break out revenue for its cloud business. But in the company’s most recent earnings report, the revenue from the “Other” bucket was $844 million, up from $515 million a year ago, for a staggering 64 percent annual growth rate. The “Other” category contains other businesses, but AWS is believed to be driving almost all of the growth. AWS remains the 800-pound gorilla in the room, despite a cloud industry which has entered into hyperdrive, particularly in recent months.

The company’s customer win case studies for the month illustrate the range of the company’s appeal.

One case study showcased the Schumacher Group, the third-largest and fastest growing physician management company. It’s an enterprise that deals with sensitive medical information. The appeal to developers and startups has long been documented, so AWS is trying to get out some solid enterprise stories, and Schumacher provides an example of this capability.

The company works with over 200 hospitals and 4 million patients. Schumacher uses Amazon EC2 and S3, backing up a lot of archival images to S3.  Its data stored is in SQL environments and it was one of the early adopters of Redshift.

Schumacher made the transition because it needed to be agile and respond to business needs. “Healthcare changes at the sign of a signature of a president, a governor – we need to be able to be very responsive, ” said Douglas Menefee, Chief Information Officer, Schumacher Group.

A critical project came up that would have taken seven to eight weeks to provision and procure the equipment,and three to four weeks to get everything configured. On AWS the project cost $4,000 to $5,000 rather than the anticipated $80,000 for equipment and staffing had they built their own solution.

Forrester recently  published a report that placed AWS ahead of the pack when it comes to enterprise cloud dev choices. Windows Azure and Google weren’t far behind, however. Application integration, mobile and internal Web applications are the three top uses for cloud environments over the last 12 months.

The company still touts startup wins, however. Hailo is another AWS customer. It’s venture funded and has global scalability goals. The company provides a virtual hail-a-cab smartphone application. It needed to get up and running and expand with demand. It grew to half a million passengers across Europe and North America in 18 months. The flexibility AWS, and cloud in general provides to startups and young companies is immeasurable; the capex hurdles have all but disappeared to get up and running. It means there’s room for innovation, and the little guy can grow to compete with established competition.

The third recent customer case study was the Genome Medicine Institute (GMI), which analyzes genomes to better understand human diseases. Faced with inadequate storage and performance coupled with increasing costs, GMI moved to AWS. The move reduced computing time by more than half, doubling its ability to analyze the human genome.

This is a big data example for AWS, filling the customer trinity for the month: the start-up, the enterprise, the big data use case. Being able to process big jobs was a major first appeal of the cloud due to the capital expenditures it took to deploy similar hardware. It’s short, intensive usage of a lot of servers, meaning that the opex appeal of renting capacity out is large.

About the Author

Jason Verge is an Editor/Industry Analyst on the Data Center Knowledge team with a strong background in the data center and Web hosting industries. In the past he’s covered all things Internet Infrastructure, including cloud (IaaS, PaaS and SaaS), mass market hosting, managed hosting, enterprise IT spending trends and M&A. He writes about a range of topics at DCK, with an emphasis on cloud hosting.

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