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Sooraj Shah

Contributing Editor

Sooraj Shah is Contributing Editor of New Statesman Tech with a focus on C-level IT leader interviews. He is also a freelance technology journalist.

The main takeaways for CIOs from AWS re:Invent

As is often the case with Amazon Web Services’ (AWS) big event in Las Vegas, re:Invent, there are so many huge announcements made in one go, that it can be hard to keep up. AWS CEO Andy Jassy’s keynote was a three hour information-dense affair which featured the usual digs at competitors Microsoft, Google, IBM and Oracle, as well as talk about features that CIOs have long wanted. 

With the help of Corey Quinn, cloud economist at the Duckbill Group, Nick McQuire, vice president of enterprise research at CCS Insight and Raj Pai, VP, EC2 Product Management at AWS, NS Tech goes through the main takeaways for CIOs from the keynote.

1. The focus was not on digital companies

Jassy underlined how far cloud still had to go when he said that only around 3 per cent of all IT spending is on cloud – the rest is on-premises. The reason for this is because many enterprises have to take their time on such a move, and Quinn believes that the approach from AWS this year is less focused on making it seem like shifting to the cloud would immediately make a company ‘digital’ and more about making it clear that AWS has some form of service for any company regardless of where they are on their cloud journey.

“The fact that they had more companies on stage that looked like Goldman Sachs rather than Netflix, and that they were talking about companies who were just in the beginning or early stages of digital transformation is very important. It’s a more inclusive message than ‘just come to the cloud and use 50,000 services, it’s easy’ – nothing is easy at scale when you’re dealing with serious business processes on the line,” says Quinn.

2. AWS is coming to a zone closer to you

McQuire explains that AWS is investing heavily in making its infrastructure run closer to the users of applications that get built in AWS, with the announcements of Outposts GA, Local Zones and Wavelength.

“CIOs will need to prioritise this area because as 5G takes hold over the next few years, and along with it technologies like mobile edge computing from the telcos, low-latency applications and customer experiences will become paramount. What we are seeing is AWS outmanoeuvring the other clouds at the moment in the early race to become the best cloud for hybrid and edge application development,” he says.

Pai adds that these three services are particularly useful for companies that have had difficulty in moving workloads for one reason or another, but require better latency.

“There are some applications that need to have a certain latency profile for end users, such as virtual desktops, control systems that orchestrate robots on factory floors, financial companies’ requirements around exchanges, agricultural manufacturing companies that use drones, and media industries for streaming and games,” he says.

Local Zones, in particular, is an intriguing move for CIOs – AWS has historically invested in Regions, which are far bigger. Local Zones enables AWS to invest in specific metropolitan areas such as Los Angeles, New York City or London.

“There has been a stupendous difference between other cloud providers having a region somewhere and AWS having a region somewhere. So a ‘local zone’ for AWS is fundamentally what other cloud providers call a ‘region’. So all you’re spinning up is a single local zone in a given city. There’s no reason you can’t light up 50 of those over two years. Whereas building a region on the other hand is as best I can tell a billion dollar industry if not damn close,” Quinn says.

Pai acknowledged that the investment is far less for AWS than Regions. But which industries should care about this?

Quinn says:  “Given that they are putting this in LA first, the easiest answer is that it’s appealing for media companies that have incredible latency requirements. The question is if you’re doing a giant render farm and having it live in S3 and having a bunch of compute on top of that, why does low latency matter?”

3. AWS wants to be quantum computing and 5G ready

With its first quantum computing, Amazon Braket, and its first foray into 5G with Wavelength, Quinn believes AWS is pre-empting what CIOs are going to require in the years ahead.

“They paint a very beautiful picture around the fact that no one knows what quantum computing is or how it’s going to work or how it’s going to manifest. And it’s the same story with 5G. No one knows what 5G is going to look like, but they’ve set themselves up to be the de facto cloud of choice for anyone in that space who’s going to be experimenting and they did it for remarkably little investment on their part,” says Quinn.