Should startups be concerned that Amazon AWS is not profitable?


3

I've read many places that they don't make a profit from their AWS services and won't be anytime soon. How can they justify this to investors who own their stock?

Even if their argument is that they'll turn a profit someday, how can a company do that without showing projections to investors?

I have two main questions:

  1. Should users of AWS services be concerned that Amazon might shut it down one day due to not being profitable? Is it risky for startups to create infrastructure on AWS due to it?
  2. Is there a larger game plan by which Jeff Bezos is doing this?

Amazon Aws

asked Feb 5 '14 at 17:09
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Evelyn Bailey
16 points
  • *Conspiracy*: They are subsidized by the government, i.e. NSA, to spy on people. – Starrychloe S. 7 years ago

2 Answers


4

Companies both big and small rely so heavily on AWS that if they were to disappear overnight, the entire internet would be in crisis. Netflix's infrastructure is built on AWS, and are responsible for 25% of all internet traffic. When you're as big as Netflix, you can start worrying.

Second, AWS are not the only game in town. Whilst they are probably the most mature, there are many other players (Cloud Foundry, HP, Rackspace).

If you're concerned, use something like OpenStack (https://www.openstack.org/) to provision your services - that way you are not tied to just one provider.

answered Feb 9 '14 at 15:24
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Dominic Messenger
41 points
  • Yeah, it's highly unlikely considering how many companies generating $100M+ use it as their primary infrastructure. – Chrissie Gray 8 years ago

2

Interesting question. I'll give you my thoughts on (1):

If you're just starting out, don't spend even a second thinking about scaling or "what ifs". Just launch on any platform and address issues as they arise.

As an engineer, I don't see how one can get locked into AWS in a manner that would be catastrophic to your business. If for some reason AWS ceases to exist, it won't be the end of the world. You can always transition to another platform like Heroku.

Take a look at Docker. It's an open source project to easily create self-sufficient containers from any application. We're using Docker here on Bright Journey ourselves. It's an awesome piece of technology.

With Docker what you build on your development environment runs at scale in production. This might be just what you're looking for to address your concern.

answered Feb 6 '14 at 12:21
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Nishank Khanna
4,265 points
  • IIRC, Heroku is built on AWS. – Dominic Messenger 8 years ago

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