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Planet
Amazon
Books and
DVDs
are fine, but
whileyou
were
setting
yourI-Click preferences,Jeff
Bezas
createdthe world's broadest,smartest,
most
versatile
technology
platform.Cloud computing
has
arrived.
Go
ahead,look inside.
BY SPENCER
REISS
Jeff
Bezos' store
in
the
sky is hard
to
beat
for books,
CDs,
and a zillion
other
products.
It's
also
great
for quick technology flxes.Say you
need
a fat
HP
server
for
hostingthe
too-moronic-to-fail Facebook app you
plan
to
launch
next
week. Only $1,300 andchange! Hit I-Click. Select expedited shipping. What's for lunch?But there's a cheaper, faster,
better
way
to
satisfy yourhardwarejones.Tuckedover
on
the
leftside
of
the
page,
the
nerdgnomesin Beacon Hill, Seattle, have
embedded
an
option
that
blowscomputer shopping into,well,
the
clouds.
Click
on "Amazon Web Services."
Key
in
your Amazon
ID
andpassword
and
behold: a
data center's
worth
of
com
puting power
carved
into
megabyte-sizedchunks and wired
straight
to your desktop.Clones
of that
HP
tower
cost
10
cents
per
hour-l0
cents!-and
they're
set
to
start
spitting
out ,'fidgets as soon as you uploadthe code. Virtual quad cores are a princely
80
cents
an
hour. Need storage?
All
you caneatfor
15
centspergigabyte
per
month.Andthere's evena tool for monitoring yourvirtualstack with
an
iPhone.
No
preciouscash
tied
up
in soon-to-be-obsolete silicon,
no
3 am runs
to the
colo cage. Outsource yourinfrastructure
to
Amazon!There's a namefor this: cloudcomputing.
Or
less poetically, utilitycomputing, oreven
I'
5
OS
COMlllERCE
iii
6
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MAY200B
PHorOGRAPH
BV
Joe:
PUG
lieS
:
r-··
~ -
~ ' ' ' ' ' . - . . . . . . . ~ . ~
,-:,.
theunfortunateacronymHaaS,meaning loads,or
Kindle
eReaders.
And
never,evertionaldata.Butthecompanydoesprovideahardware
as
a service. Whatever it's called, listen to
Wall
Street. Because while the pin
few
figures,
and one shines a light
on
how far
JeffBezos is
loving
it. Dna sunny winter
day,
stripes gnashed their teeth about
costs
Amazon
has
come
from
the
oldWal-Mart-in
withMountRainierandthe
Olympic
range morethan$2billionspent
on
IT!-Amazonthe-skyconcept.Almostathirdofthestore'sonspectaculardisplay,thebaldbillionaire wasboltingtogethertheworld'sbroadest,totalnumberofsaleslastyearweremade
by
sitsinaconference
room
intheconverted
VA
deepest,smartest,mostversatileglobalpeoplesellingtheirstuffthroughthe
Ama
hospitalthatserves
asAmazon
headquartechnologyplatform,readyforanything
zon
machine.
The
companycallsthemseller
ters.
He's
ticking
offall
thereasons
whyAma
from
runningdatacenterstodeliveringcatcustomers,andthereare
1.3
millionofthem.
zon
Web
Servicesanditsindustrial-strength litter.
Now
Bezos'globe-spanningempire
is
They'rejustone
wave
ofoutsiders to
have
suiteofonlineprocessingpower,storage, primedtoleadthemigrationofcomputing washedoverBezos'threshold.
The
nextisandothergeekytreatsarethebestthing power
from
thedesktoptothe
Net.
It'sashiftalreadybreaking:
Web
developersitching
to make
their mark
on
the
Net.
The transformation from storefront toplatform happened
by
evolution ratherthandesign. Itbeganwaybackinthedialup dark
Outsource your infrastructure
ages, when
Bezos
and his crew were look
to Amazon!
No
more 3
am
runs
to
ing for a cheap and easy
way
to
expand the
the
colo cage, no
cash
tied
store's reach.
One
solution was to let
Web
up
in soon-to-be-obsolBte silicon.
developers link directly to Amazon products
on
their own
pages-and
give them ato
come
out of the company since I-Click. potentially
as
dramatic
as
the desktop
revo-
15
percent bounty
on
sales they generated.
AWS
capitalizes
on
Amazon'scombination lutionthatanotherSeattle-areacompany-Todaythatprogram,
AJnazon
A ~ c i a t e s ,
is
of computational skills and operational often similarly
underestimated-rode
to the Net's definitive distributed sales netsavvy. It piggybacks on a multibillionpower two decades
ago.
Jeff Bezos'
aerial-
work, turbocharged by the
w o r l d ' ~
dollar
IT
infrastructure.
And
it pulls in a department store leafing out into a digital archive of product information, customer
wholenew
categorY
ofcustomers
looking
for
cloudforest.
Amazon,
indeed.
reviews,
andreconunendations.
One
spooky
rock-solid scalable computing
on
demand
Associates service dubbed Omakase-Japblue-chip startupslike
Zillow
andPowerSet,
If
you're
an
Amazon
customer livinganese for "Leave it up to
us!"-offers
upkids in garages building the next Google,between the Golden Gate Bridge and the Amazon product ads keyed to your site'seven adventurous corporate
IT
jocks
look
western edge ofthe
Rockies,
there's a good content, your audience's response
to
earingtooffloadsomeofthedrudgery. chanceyourlatestshipmentoriginatedina lierads,and(gulp)thespecificviewer'sBut hold on, Jeff.
Back
in the material big
box
rising from the sagebrush in Fernpast Amazon purchases.
Google
AdSenseworldof
FedEx
boxesand
holiday
wish
lists,
ley,
Nevada,ahalfhourdrive
up
I-BO
from withakickback.some 80
millionAmazon
customers
this
year
Reno.
If
aspreadsheetturnedintoabuild
Turning
otherpeople'Ssitesinto
Amazon
are expected
to
drop $20 billion nonvirtual ing,
this
wouldbe
it:
14
windowlessfootballstorefrontssetastageforthenext
leap:
letdollars into the Beacon
Hill
tilL
Computer fields of wide-open concrete. Inside, it's a ting outsiders sell their
own
stuff throughhardwareisrightupthere
on
thehitparade Donkey
Kong
worldofoverheadconveyor Amazon'splatform.Third-partysellingwith
Harry
Potternovelsandboxed
DVDs
of belts,automatedchutes,androbotictilt beganin
1999
as
ajitteryresponse
to
eBay,
The
Simpsons.
Foryears,
Wall
Streetand trays.
The
floorissurrounded
by
two-story whichlookedsmartforavoidinghandlingSilicon
Valley
alike
haverolledtheireyesat metalstorageracksthatcoulddouble
as
a thingsphysicalaltogether.Amazon'sauc·thelegendary
Bezos
attentiondeficitdisordatacenter'sharddiskarrays.
Tom
Taytions
were
abust,butthey
kicked
offwhat
is
der.
What'sthatsecretpetproject?Spacelor,anoperationsmaestrovisitingfrom
now
thethriving
Amazon
Marketplace("Sellships!Earth
to
Jeff:
You'rearetailer.
Why
Seattle,reachestowardoneoftheshelves
Your
Stuff").
The
companyearnsacutof
up
swappricey stuff
in
boxes
for
cheapcloudsof andpullsoutaheftytomeentitled
Intro-
to
15
percentfrom sellers
who
optforplainbits?
Cue
oneof
Bezos'
famed
mirth
bursts:
ductory Physics
With Algebra
as
a
Second
vanil!aproduct listings
("12
used
&newfrom
"That's a really good question!"
Honk!
Language: MasteringProblem-Solving.
It's $58.99").
High
rollers can sign
up
for topBut
Bezos
being Bezos-ex-hedge-fund lightly used, with a barcode label pasted of-the-line Fulfillment
By
Amazon, whichquant,
cool
Seattle Spack
to
Silicon
Valley's
neatly
on
the cover. "The seller could be parks their goods
on
the shelves
(45
centshigh-flying Captain Kirks-there's also a anybody," Taylor half shouts through the per cubic foot per month), then slips themreally good answer, and it goes somethingdin and mandatory earplugs.
''You
need ainto Amazon's own shipping stream.
If
like this: Don't get hung
up
on
ecommerce. scanner to know whose it
is."
you're Target or the
NBA
(or,
until recently,Don't
fixate
on
Amazon
Prime,media
down-Amazon
isnotoriouslytightwithopera-Borders),
you
cansitbackandrentaworld-
COMMERCE
mmm
MAY2008
vice in February,
"amazing
how
many
of
the
services iuse are reliant
on
83." Among
the
temporary casualties
that momingwasTwitter
itself, which
stashes user
profileimages on Amazon's servers.Utility computing
is
Web 2.0's version
of
rocket fuel.
"You
don't
generate your ownelectricity," Bezossays. "Whygenerate yourowncomputing?"The forces drivingonline
apps-Internet
bandwidthand
reliability
also mean
that,
intennsof
data
per
dollar,
servers
in
your closet
or
colocation facility can't compete
with
industrial-scale bitspiped in from hundreds, even thousands,
of
miles away.Amazon's developer-customers reap several advantages. Capital efficiency is one.(Trendy Mountain View-and Delhi-based
startup
SlideShare cheekilydubbed one ofits presentations "Using 83
to
Avoid VC:')Another
is
instantscalability.
AWS
users canadd
or
delete
server and storage
capacitywithout getting up from
their
Aerons.
AWS
trades heavilyon
the
fact thatAmazon itself
is
the
biggest customer. "We tend
to
build
the things
people
are
asking forinternally,"
Jassy
says. And
the
idea
that
AWS
is mostly about wringing extra bucks(especiallyoff-season) outofAmazon'sdata
centers?
"We've far exceeded
the
excesscapacity
of
ourinternalsystem," Jassysays."Thatshipsailed
18
monthsago:'Foracompany
at
which
operational data
is a
state
secret, that'satellingdetail:
AWS
isnowbigenough
to
be piling
up
its own silicon.
A
museum
of
Amazon memorabilia
decorates
the
BeaconHill btulding's lobby.
One
cabinet enshrines a faded copy
of
the
May
31,
1999, issue
of
Barron's.
"Amazon.bomb,"
the
cover screams. Barnes
&
Noble,
then
the
King Kong
of
booksellers, had
already followed Bezos online. Wal-Martwasgearing up for a Netoffensive, too. AndAmazon's nwnbers,Barron'ssmirked,were"gimmicky." Nearly a decade later, BeaconHill is still on top. "We can live
with
beingunderestimated," Bezos says.That's easy
to
do, for
the
moment. WallStreet'sbestguessesfor
AWS's
2007revenuedon'tevenreach$100 million-theproverbialpimpleamidnearly
$15
billion
in
overall sales.classecommerce operation, from shoppingcart
to
warehouse
to
delivery.The rationale for
all
this,
in
Jeff-speak,
is
"totally
not
abstract." Meaning it's a nobrainer.
"If
you're trying
to
have
not just
every
book
but
everyout-of-print
book,everyindie-band
CD,
and
everyvinyl record.there's noway you're going
to
do
it
on yourown.
You
have
to
open up."That
turns
out
to
be
harderthan itsounds.When Amazon plunged into auctions, itssimple
dottom-era
server-and-database
combo was already staggering
underthe
combined weight
of
growing
complexity
recommendationengines, transaction tools,a steady rain of new
features-and
mushrooming traffic. Beset by problems
with
speed, reliability, and scalability, engineersfirst tried migrating
the
whole hairball
to
amainframe.
It
didn't help. Then they gam-
Just
acrllss
Highway
101
from
the
Googleplex in Mountain
View,
California, abanner fluttering from a nondescript building
heralds yet
another
high
tech
dream:Ooyala.lnside, a dozensoftware engineers
wearing headphones
pore over
screen
loads of code while grazing
on
M&Ms
andorganic
treats
served
in
plastic tubs. Thethree
fOWlders,
all Google emigres,are chasing a suitably big
idea-interactive
"hypervideo"
with
seamlessly
embedded
links.Whatthey>re notdoing
is
blowingcapital onshiny hardware. They built their televisionkiller using
little
more
than
the
desktops
in
front
of
them, plus major slices
of
com
puting
power courtesy
of
Mr.
Bezos. "You
can't
execute fast when you're running
to
thedata centerevery night to
fix
machines,"saysOoyala engineeringchiefSeanKnapp."Infrastructure is
the
big guys'
most
pow-
IfCommodity
businesses
don't
scare
us;' Bezos says.
I/We've
never
had
35
or
40
percentmargins
like
1110st
tech
con1panies:'
bledon a Net-centric idea
just
beginning
to
bubble
through
the computerscience world:looselyjoinedsoftwaremodules, each performing a specific function while exchang
ing
informationwiththe others. Bingo.
Log
in
to
Amazon's
gateway today and
morethalllOO separate services leap into action,crunching
data,
comparingalternatives,andconstructinga totallycustomized page (allin about 200 milliseconds).The
new
architecture brought
a huge
improvement-along
with
an
unexpected
opportunity.
"We were
already building
these really incredible, robust services for
ourselves/'
says Andy Jassy,
who
wrotethe
original Amazon Web Services business plan four years ago and has been running
the
operation ever since.
"It
wasn't
ahuge leap
to
realize
they
could be valuable
to
other people." Thus Amazon's next newbusiness: opening not
just
the store
in
the
sky,
but
the very silicon and software
that
keeps it aloft.erful asset. This levels
the
field."
Ooyala-that's
"cradle" inIndia's Telugu
language-epitomizes
Amazon's vision
of
utility computing. Last December, Knapp
and hiscrew
beat
more
than
900 other
AWS-powered
startups
in a demo derby,taking home $50,000 in cash
and
$50,000in usage credits. (Bonus prize: a decommissionedAmazon
server
plus agold-painted,Bezos-autographedsledgehammer tobashitwith.) Ooyalajoins a who's who
of
high-profile
AWS
clients, including Justin.tv, whichserves up a half-million live videostreamsdaily
thanks
to
Amazon
hardware.
Real
estate
site Zillow recalculated
the
values
of
67million
US
homes
in
severalmassive
rWlS,
and
the
grayold
New York Times
crunched
150
years' worth
of
newspapers intosearchable
PDFs.
An
estimated10,000!lewdevelopers are signing
up
monthly, with
the
totalclosing inon400,000.
As
New
York
venturecapitalist Fred Wilson Twittered during a
brief outage
of
Amazon's 83
storage
ser
1605
r:
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