Amazon still rules the cloud according to Gartner’s latest annual report, but analysts warn that it has ‘poor cohesion’ among its products and that its size may scare off potential customers (AMZN)

Andy Jassy

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Amazon was a cloud pioneer when it first launched Amazon Web Services in 2002 and it still dominates the market today, according to Gartner’s annual “Magic Quadrant report that ranks cloud services like AWS, Microsoft, and Google Cloud with categories like “ability to execute” and “completeness of vision.”

AWS once again scored the highest as a leader and visionary, with Gartner describing it as a “strong performer” in most use cases.

“AWS has an enormous ability to turn on a dime,” Raj Bala, research director at Gartner, told Business Insider. “They make decisions rather quickly and come to the market with market defining products as a first mover advantage.”

AWS has the largest share of the worldwide market, including in its cloud infrastructure and database products, with wide reach across the US, Japan, Italy, South Africa, and Brazil. It also has the “skills, resources and motivation” to deliver a complete set of products to customers, Gartner said. 

The report wasn’t all praise though:

AWS also has “poor cohesion” across its products, Gartner said. While it’s the leader in the cloud market, AWS’s products — especially new services — may have inconsistencies because of the way the company is organized. This, Gartner says, “can be daunting to many enterprises.” Likewise, its price reductions are not applied universally across all its products. 

“They tend to be the first to market, so have some messy jagged edges and clean those over time,” Bala said. “That’s kind of AWS in a nutshell.”

There are external pressures as well. 

AWS sees rising competition from Microsoft and Google Cloud. Most recently, it took a blow when the Department of Defense affirmed its decision to award a $10 billion cloud computing contract to Microsoft (though Amazon is still contesting the deal). 

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Also, because of how big AWS has become and its relationship to Amazon, partners and customers may see it as a competitive threat (AWS generates over half of Amazon’s operating income). For example, while AWS does have retail customers like Levi’s and Adidas, retailers like Walmart have opted for a different cloud service.  

Similarly, software companies like Redis Labs, Confluent, and Elastic have butt heads with AWS for repackaging their free, open source software to sell on its cloud, while contributing little to the open source community. 

“The growing concerns about Amazon’s size and reach, coupled with AWS’s leadership position, give pause to some of its partners and customers,” Gartner analysts write. “Furthermore, AWS risks alienating software developers, which are its core constituency, as a result of the company’s skirmishes with the open-source software (OSS) communities.”

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SEE ALSO: Capital One explains how it’s spent almost a decade modernizing its IT with Amazon’s cloud and the agile developer methodology to move faster and stay competitive

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Source:: Business Insider


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