A data point thrown out by one of Amazon’s tech gurus at its re:Invent conference testifies to the immense growth of its cloud operation.
The mass migration of data and computing power from privately owned data centers to those operated by Amazon.com, Microsoft and other competitors is one of the biggest business stories of our time. But sometimes the growth of the so-called “cloud” is hard to grasp.
Here’s one way to look at it: Every single day, Amazon’s cloud computing business adds enough server capacity to support the data storage and computing needs that the online tech giant had in 2005, when it had revenue of $8.49 billion. That’s about the revenue of a middling Fortune 500 company.
The figure comes from James Hamilton, a high-ranking tech guru at Amazon Web Services, Amazon’s cloud computing unit. “This is a crazy number. Think what it means,” Hamilton told an audience of cloud enthusiasts and developers Tuesday at AWS’ re:Invent conference in Las Vegas.
It certainly means a lot of building or leasing of warehouses, shipping servers, consuming power and such. In other words, the cloud, esoteric as it seems, relies on a very brick-and-mortar reality that needs to be continually expanded, at a cost of billions.
Another way of measuring it: As of December, AWS either rented or owned about 6.7 million square feet of space, or the equivalent of some 116 football fields.
To the extent one can read between the lines of Amazon’s earnings statements, it can also be measured in money. From 2010 to 2015 Amazon’s technology and content spending has expanded sevenfold, to $12.5 billion (Amazon said in its annual report that infrastructure related to AWS has been a primary driver of spending in that segment.)
Then there’s the big truck. On Wednesday, AWS hauled a trailer, amidst thumping heavy-metal music, into the cavernous meeting hall where re:Invent was being held. Its trailer carried what AWS calls a “snowmobile,” a device that can store an exabyte of data. That’s one billion gigabytes, equivalent to 31.25 million base iPhone 7s.
The point is to move the data physically from a company’s data center to Amazon’s cloud without hogging all of the world’s bandwidth.
All these physical trappings show the momentum the cloud has. For Amazon, it’s a business that will generate about $13 billion over a 12-month period based on last quarter’s rate, and is obviously growing.
That’s why Andy Jassy, the CEO of AWS says that over time the cloud business could top Amazon’s gigantic retail business in revenue.