Amazon’s AWS re:Invent 2017 Marks the Beginning of a New Era in IT
tl;dr Amazon’s announcements at it’s 2017 developer conference define the beginning of new era in IT. The company announced a raft of new managed services that enable customers to focus on extracting business value from their application investments without the demands and costs of designing, building and operating complex infrastructures. Central to this third wave of cloud computing are new managed services for serverless-computing,_machine learning, data analytics, and the Internet-of-things_.
Amazon is executing a strategy to maximize time-to-value. The third wave of cloud computing will enable customers to focus on the business logic of their applications, derive analytical insights from real-time data streams and leverage the predictive power of deep-learning models all while leaving the infrastructural complexity and operational ’heavy-lifting’ to Amazon.
Businesses that have not already made the move to cloud face increasingly stark choices: Either leap-frog to third wave managed services or be for ever at a strategic and competitive disadvantage.
CEOs and Boards of Directors, who lack the understanding — or are unwilling — to make these choices are failing in their fiduciary responsibilities.
The $18B Gorrilla
Amazon’s re:Invent developer conference held last week in Las Vegas was attended by forty three thousand souls. That Amazon can attract that many paying customers to their annual technical event underlines the company’s dominant and influential position in the cloud computing business.
Amazon’s cloud business can be traced back to 2002 but was formally re-launched as Amazon Web Services (AWS) in 2006. The AWS business now generates over $18B in annual revenue for Amazon and — despite aggressive competition from Microsoft and Google — AWS’ market share grew from 39% to 44% year-over-year. In the last five years AWS have launched 3,951 new services and features.
The pace of innovation in the AWS business ensures that Amazon remains not just the market leader but also the thought leader in cloud computing. Amazon’s announcements of new services and features at re:Invent every year have a habit of defining the agenda for the cloud business and set the benchmark for others to aspire to. This years conference was no different
The Waves of Cloud Computing
The cloud business — since it’s inception in 2006 — can be divided into two distinct waves. Early cloud computing capabilities enabled the first wave of customers moving existing application workloads from private data centers to utility infrastructure managed by Amazon. Customers gained the advantage of reducing capital investments in complex physical data centers while tapping the cloud’s ability to provide utility infrastructure on demand, with costs based on consumption.
Most applications moved during the first wave could not take advantage of the native scaling and resiliency of the cloud but a second wave of migration emerged as customers built a new ‘cloud native’ applications composed from a growing portfolio of cloud services available from AWS — and other cloud providers. These new ‘native’ applications were architected to deliver the attendant advantage of cloud computing’s scaling, resiliency, management and security capabilities.
Leveraging the dynamic scaling and resilient fault tolerance advantages of the cloud environment still requires customer’s architects and developers to configure clusters of servers, wire together complex stacks of inter-connected software, implement complex networking topologies and configure and manage multiple layers of data storage technology. To deliver all of this customers still need to hire and retain advanced architecture design, development and operations skills.
Ultimately, all of the inherent complexity of building cloud applications has limited the impact of cloud computing to companies that can afford the human capital investments — or the financial investment required to pay someone else to do the work.
Disrupted, again
The third wave of cloud will remove the need for customers to concern themselves with the architectural and operational complexity of the computing and data infrastructures that underpin their applications. All of that complexity will be neatly packaged and abstracted away through a set of managed services offered by Amazon and other cloud providers.
“The only code you will write in the future is business logic. Everything else will be managed services” – Werner Vogels — CTO, Amazon
Perhaps the most indicative of Amazon’s third-wave announcements was Amazon Sagemaker. Testing, deploying and leveraging deep-learning models is an incredibly complex undertaking. SageMaker provides data-scientists with an end-to-end suite of tools to develop and deploy sophisticated deep-learning models without having to deal with complex infrastructure issues.
Amazon is utilizing it’s deep-learning capabilities to optimize it’s own services and to deliver a growing portfolio of deep-learning enabled services for including object recognition in video, voice transcription and translation and natural language analysis.
The natural language analysis service — AWS Comprehend — is indicative of the nature of third wave cloud services. Comprehend provides a fully managed — deep learning enabled — natural language analysis capability delivering entity extraction, key phrase identification, source language identification, sentiment analysis and topic modeling. All of this can be done on real-time feeds of textual data and does not require the building, deployment or operational management of complex infrastructures by the customer. Businesses can focus on leveraging the analytical power of the service while Amazon ensures it scales, is reliable and secure. Customers only pays for the resources used in per second billing increments.
Amazon’s investments in a new serverless-computing model are anchored around AWS Lambda. As the name — serverless — suggests this new approach to application development removes the need for customers to configure or deploy server resources. Lambda — which is growing in adoption by 300% YoY — is a managed service that automatically executes software functions when triggered by events. Those events could be anything: from a user clicking on a button on a web page to a smart sensor sending an updated piece of data. AWS Lambda is rapidly becoming the hub for a wide range of Amazon services. A wide array of sophisticated cloud applications can now be composed from existing AWS services, linked and coordinated by the execution of Lambda functions.
Amazon made a number of key announcements in the data storage and management domain that underline the move to a third wave managed cloud computing model. Amazon Aurora is the company’s cloud native relational database. Aurora is one of the fastest growing services in AWS history with 250% YoY growth. At re:Invent, Amazon announced Aurora Serverless which provides database startup, shutdown and auto-scaling based on application demands without customers having to manage any database instances or infrastructure. Customers are billed only for the resources utilized while the database is running.
Amazon DynamoDB is the company’s cloud scale NoSQL database for unstructured data management. The company announced DynamoDB Global Tables last week which is a new fully managed services providing automatic data synchronization and fault resilience across a globally deployed database infrastructure. This new capability removes the need for customers to configure complex replication and data distribution topologies and infrastructures. Further reducing operational complexity Amazon announced DynamoDB Backup and Restore providing on-demand and continuous backup — with point-in-time — restore for DynamoDB tables.
One announcement of particular interest to enterprises will be Alexa for Business (AfB). Amazon is enabling their hyper-popular voice-activated smart agent technology for the office environment. AfB will integrate with common workplace technologies to provide full automation of meeting rooms, Audio-Visual presentations, meeting scheduling and other tasks. The AfB service will enable business customers to deploy and manage Alexa devices at scale and will enable individuals to integrate their personal and business Alexa profiles while at the office.
There were significant number of additional announcements at re:Invent 2017 including several related to the Internet-of-Things (IoT), new ways to manage computing instances and new types of compute instances optimized for deep-learning and other computationally intensive applications, a new graph database for relationship based data topologies called Amazon Neptune and AWS Cloud 9 a new integrated environment for developers to enable rapid construction, testing and deployment of AWS based applications.
Strategic Imperatives
Amazon’s announcements at re:Invent 2017 clearly mark a transition in the maturity of cloud computing and point the way to a fully managed third wave of cloud applications.
The transitions we’ve witnessed in the cloud computing business are analogous to those witnessed in the automobile industry — albeit over a vastly accelerated time-scale. In the last 150 years we evolved from craft-built motorized horse carriages, to mass produced cars to now driverless vehicles. The first wave of cloud computing was built by hand, the second wave of cloud enabled mass production of applications by the sewing together of component services.
Driverless vehicles abstract away all of the complexity of the driving process from the consumer while conveying them safely and comfortably from A to B. The third wave of cloud computing will do for business what driverless cars will do for motorists — sweeping away the underlying complexity that plagues business system IT while vastly improving time-to-value and the impact of investments in new data and deep-learning enabled capabilities.
Organizations face critical choices about the velocity and effectiveness of their transition to the cloud. Amazon’s announcements this week make those decisions imperative.
Companies that have not yet made the jump to cloud face stark choices: Either leap-frog to a third wave fully managed model or face the prospect of being for ever at a strategic disadvantage to the disruptors in their industry.
Companies that have already migrated their IT to the cloud must keep pace with these changes and the new third wave model or again face being at a significant strategic disadvantage.
Being behind by two or even one generation of cloud technology places companies at significant competitive disadvantage: The equivalent of selling horse drawn buggies in a world of driverless cars.