Cloud fight keeps Amazon, Microsoft, Google, and Rackspace clamoring for enterprise customers

All the major players are enhancing their offerings as competition heats up

Amazon Web Services is attempting to distance itself from other cloud providers by enhancing its services to incorporate the differentiating features of its competitors.

But as Amazon sets its sights more keenly on the enterprise market, recent moves by Microsoft, Google, and Rackspace to improve their IaaS (infrastructure as a service) cloud offerings are creating an increasingly competitive cloud market, experts say.

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"There's a war going on in the IaaS market," says Paul Burns, an analyst at Neovise, a boutique research firm focusing on the cloud. Last week in New York, Amazon hosted one of 13 Summits it plans to hold across the world in the coming weeks, touting the success of its platform and trotting out examples of enterprise customers using its services. And it provided the backdrop for Amazon to discuss the recent advancements of its services.

AWS, a division of the Amazon.com e-commerce site, began in 2006 with two basic cloud-computing services: scalable storage (through Amazon Simple Storage Service or S3) and virtual machines on demand (through Amazon Elastic Compute Cloud or EC2). Amazon CTO Werner Vogels says AWS now incorporates 33 major services and products in its cloud. He announced last week that S3 now stores more than 2 trillion objects in its cloud, as of last week, and it serves, at its peak, 1.1 million requests for those files per second. The company has hundreds of thousands of customers in 190 countries, and it has reduced prices 31 times since launching in 2007. "And we will continue to do so," Vogels says.

In the last month, Microsoft and Google have made significant announcements for their AWS-competing products. Microsoft made its on-demand virtual machines (which include both Linux and Windows OSes) generally available last week. The week before, the beta tag came off of Google Compute Engine, which offers pay-as-you-go virtual machines.

Burns, the Neovise analyst, says there are two battles going on in the IaaS market right now. One is for basic services: compute, network and storage. With Microsoft and Google making their IaaS offerings more open to customers, they're adding competitive pressure to AWS for some of the company's original services, he says. There is a second battle for higher-level services, like databases, security, disaster recovery and running business applications, though. And on that front, "AWS is the only game in town," Burns says. "They're walking away with the market on the higher end of the stack."

The breadth and depth of AWS services it offers in its cloud all on an on-demand basis are unmatched in the industry, he says. AWS has multiple different database offerings, from its RDS (Relational Database Service) to DynamoDB, a non-relational key-value store database. Last year, the company rolled out a data warehousing offering named RedShift, and the company has a network of ELBs (Elastic Load Balancers), EBS (Elastic Block Storage), and application and management tools for deploying applications and configuring cloud architectures. Its partner system allows customers to run enterprise-grade applications from SAP, Microsoft, Oracle and dozens of other companies in its cloud.

Burns says Amazon could have the potential to take some hits from other providers on the lower end of the market where it is facing increased competition, and there is a growing market of IaaS providers each looking to carve out a niche of its own in the market on these basic services. Microsoft, for example, claims it is one of the only companies to offer a true "hybrid cloud" offering between its on-premises Windows Server and Microsoft Azure cloud. Rackspace offers "fanatical support" and has been broadening its database offerings recently; Joyent and ProfitBricks are among the cloud providers that focus on high-performance computing, while a company like FireHost emphasizes security in its cloud.

AWS is responding in turn, though. During the past few months AWS has begun incorporating the differentiating features of competitors' services into its own cloud offering. In the past few months AWS has rolled out the following updates, for example:

Trusted Advisor: A service that monitors customers usage, recommends ways to save money by using more appropriately sized resources and provides advice on how to improve security and reliability. During the AWS Summit, Vogels said AWS has helped customers save $22 million through Trusted Advisor. "We're actually advising our customers to spend less," he says, explaining that customers who more efficiently use AWS resources will be more successful and be AWS customers longer. This service flies in the face of not just Rackspace, which emphasizes customer support, but also an ecosystem of third-party tools that provide real-time analytics of AWS services.

AWS OpsWorks: One of the lingering questions about Amazon's moves in recent years: Is the company turning its market-leading IaaS offering into a PaaS (platform as a service)? The biggest difference between the two is that IaaS is where applications run, whereas PaaS is generally where applications are developed.

AWS has a variety of PaaS-like offerings in its cloud, with the latest being OpsWorks, which makes it easier to configure AWS resources to run applications in its cloud. These complement services like AWS CloudFormation, which is helpful for tying various AWS services together, and Elastic Beanstalk, which helps users uploading applications to its cloud.

CloudHSM: In an effort to beef its security practices, Amazon announced CloudHSM (Hardware Security Module) last month, an appliance used to store encryption keys that only AWS users have access to. The month before, AWS announced that the default setting for new virtual machines in the EC2 service would be "virtual private clouds" (VPC), meaning they are logically isolated virtual machines through network segmentation. Vogels said today at the Summit that security, and encryption especially, would be a focus of the company's moving forward, and the HSM and VPC announcements seem right in line with that.

That doesn't include a variety of other announcements the company has made, including new features for its RDS database, allowing users to scale up and set predefined IOPS (input/output per second) of up to 30,000 per database instance. AWS rolled out support for Hyper-V virtualization platform from Microsoft for its storage gateway, which work to synchronize data between customers' premises and the Amazon cloud. At the Summit, AWS announced new analytics tools for its DynamoDB non-relational database, and new encryption features for Oracle relational databases running in its cloud.

Mark Levitt, who tracks the enterprise cloud market for Strategy Analytics and attended the AWS Summit last week in New York, says Amazon trotted out enterprise customers to discuss how they're using AWS cloud services. Representatives from Bristol-Meyers Squibb, General Electric, and NASDAQ all spoke about their use of the Amazon cloud. Following up on recent reports that the CIA is paying $600 million to Amazon to help build a private cloud, Levitt says the product enhancements, combined with the customer case studies, give more credibility to Amazon making the case that it is a viable public cloud provider for the enterprise market.

Network World senior writer Brandon Butler covers cloud computing and social collaboration. He can be reached at BButler@nww.com and found on Twitter at @BButlerNWW.

This story, "Cloud fight keeps Amazon, Microsoft, Google, and Rackspace clamoring for enterprise customers" was originally published by NetworkWorld .

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