Provocation: The Most Underrated Tech Company is...
I recently read this response on Quora from Amazon's CTO (Werner Vogels) on why they got into the web services business.Virtually every entrepreneur I speak with hosts their web and mobile applications with either:
- Amazon Web Services (S3, EC2, etc); or
- RackspaceI don't think the investment market has fully realized the value in this business. As more and more companies "grow-up" in the cloud; as more and more CTOs become comfortable with the cloud; as more and more large companies trust the cloud, this market is set to explode over the next decade.UBS analysts Brian Pitz and Brian Fitzgerald released a report which projects Amazon's Web Services business to do about $500 million in revenue in 2010, $750 million by 2011 and close to $2.54 billion by 2014.My gut says they are underestimating - by a lot.The time, energy and resources Amazon has invested in this space far outpaces any of their competitors (including Google, IBM, Apple and MSFT). Commerce will continue to be a big business for Amazon - but this will be much bigger.Also, one of the big dogs listed above will scoop up Rackspace to try and compete with Amazon. Two other things to note:
1) Amazon's recent upgrade to their flexible payments is a big step up and creates real competition to PayPal. This is also a very big market and they have the leadership, capital and engineering talent to compete.
2) Today's announcement about partnering with American Express - so that you can use your rewards points to make purchases on Amazon is awesome. Less friction means more purchases. Amazon = BUY.
- Amazon Web Services (S3, EC2, etc); or
- RackspaceI don't think the investment market has fully realized the value in this business. As more and more companies "grow-up" in the cloud; as more and more CTOs become comfortable with the cloud; as more and more large companies trust the cloud, this market is set to explode over the next decade.UBS analysts Brian Pitz and Brian Fitzgerald released a report which projects Amazon's Web Services business to do about $500 million in revenue in 2010, $750 million by 2011 and close to $2.54 billion by 2014.My gut says they are underestimating - by a lot.The time, energy and resources Amazon has invested in this space far outpaces any of their competitors (including Google, IBM, Apple and MSFT). Commerce will continue to be a big business for Amazon - but this will be much bigger.Also, one of the big dogs listed above will scoop up Rackspace to try and compete with Amazon. Two other things to note:
1) Amazon's recent upgrade to their flexible payments is a big step up and creates real competition to PayPal. This is also a very big market and they have the leadership, capital and engineering talent to compete.
2) Today's announcement about partnering with American Express - so that you can use your rewards points to make purchases on Amazon is awesome. Less friction means more purchases. Amazon = BUY.
