Another day, another mistaken assumption that Amazon’s public cloud business is ripe for disruption. This time it’s ZDNet’s David Berlind arguing that Telcos (no, really) are on the cusp of relegating AWS to the dustbin of cloud history. Berlind gets several things right about the raw materials Telcos have that could be used to unseat Amazon. But he conveniently overlooks the entire of history of computing to reach his conclusion that these raw materials matter.
I’m not a fatalist, believing that once a company claims a dominant position in a market it necessarily will own that position forever. The world changes, and in the technology world by the time government antitrust forces get around to taking action against a Microsoft or Google, the market will have changed. Microsoft won in operating systems but the world moved to the web. Google is winning on the web in search but we’re increasingly moving toward a social web. And something will eventually disrupt Facebook’s hold on social.
So I don’t think Amazon’s dominant grip on cloud computing is forever. But I also don’t think for a millisecond that Telcos will be the ones to unseat Amazon.
Berlind defends his argument by quoting analyst Ari Banerjee, noting that carriers
own the network, they own the subscribers, they are used to delivering five nines availability, they know how to provide turnkey applications and services to hot market segments like [small and midsize businesses] SMBs, and much like the way that Amazon got started in the business of IaaS-provision, they have data centers with extra capacity.
And yet they have done exactly nothing to diminish Amazon’s market power. Nothing.
Perhaps because, as Cloudscaling CTO Randy Bias argues of enterprise clouds, their approaches are mired in the past. Amazon is an entirely new way of thinking about IT which enterprises and the Telcos that have served them don’t seem to be able to grasp. Yes, AWS succeeds because of its simplicity and because of its rapid feature improvements, but ultimately it’s winning because it’s not like the traditional model that Telcos have pushed.
The Telcos have been well-positioned, based on raw materials alone, to take on Apple, Google, and any number of successful companies. But they haven’t. They remain dumb pipes, despite buckets of money spent trying to become “un-dumb.”
Cloud isn’t simply hosted IT. It’s a different way of thinking about IT. Cloud changes the way we manage our systems, the way we buy/rent them, the way we secure them, and just about everything else. Don’t look to Telcos to figure this out. They have far too much invested in outdated ways of thinking about networks and IT.
