How Amazon is turning cloud computing into the ‘new normal’
“More and more companies are moving their computing workloads to Amazon Web Services,” the Amazon Web Services (AWS) senior vice president declared from the Las Vegas stage, pointing to fast-growing digital businesses such as Airbnb and Pinterest and venerable Fortune 500 companies like Bristol Myers Squibb (BMY), Johnson & Johnson (JNJ), and Merck (MRK).
Certainly, according to an oft-quoted “magic quadrant” evaluation cooked up by research firm Gartner, the sheer computing capacity in active use on AWS server and storage hardware is roughly five times what’s available in aggregate from its 14 closest cloud computing competitors. AWS services are used by more 1 million active monthly customers, Jassy estimated.
Much of that lead is due to first-mover advantage, however, and new offerings from Google, Microsoft and Oracle are giving large businesses far broader options for moving mission-critical business applications out of on-site data centers and into the cloud.
So Amazon (AMZN) is launching several new AWS products due early in 2015 year intended to solidify its lead. They include a speedy new database (called Aurora), better encryption, business process management services, and additional technical support options. The common thread: all were developed in collaboration with existing customers that are migrating far more strategic applications and completely new digital services into cloud data centers.
“You can have different opinions about how complete and how fast this transition is going to happen, but it also seems apparent at this point that the cloud is becoming the new normal,” Jassy said.
During the first wave of adoption, many large companies dabbled with cloud services to development and testing of new applications—but few actually used cloud service providers to run the finished software, he noted.
Much of the current cloud transition centers on web site migrations (Unilever has moved more than 170), along with sophisticated analytics services (like ones for clinical data created by Pfizer) and mobile apps (such one created by Qantas for its flight attendants).
Philips turned to the Amazon cloud to create its informatics and analytics because of the massive amount of data it needed to manage—it adds almost 1 petabyte of information every month. (For perspective, a petabyte is equivalent to about 1,000 terabyte and is enough memory to store the DNA of the entire U.S. population—and clone it twice.)
“Data alone is not enough. We needed to make it actionable . . . There is only one company that could give us that scale,” said Jeroen Tas, CEO of Healthcare Informatics Solutions and Services, Philips. (Tas was one of several AWS customers who showed up as on-stage references.)
Another high-profile thumbs-up came from business software company Intuit. It is moving all its services and applications to AWS over the next several years. “It will help us speed development, innovate faster, and address our customers’ problems faster,” said Tayloe Stansbury, chief technology officer of Intuit (INTU). A big motivator: its experience with 10 acquisitions of smaller companies running IT operations on AWS. Intuit already moved one of its most strategic consumer products, the Mint personal financial service, to AWS.
Johnson & Johnson is also preparing to be more “bold” with its cloud computing investments. In large part, this is so it can introduce new products and services as quickly as smaller, more agile competitors. Right now, the pharmaceutical giant runs approximately 120 applications using cloud services. That number will triple over the next three years, according to J&J CTO Dan Zelem.
The company’s aim is to create “the borderless data center,” so that the experience for J&J employees, customers and business partners is seamless regardless the service or application they use. “This is a model that larger enterprises will face as a reality,” Zelem said.
This item first appeared in the Nov. 13, 2014 edition of Data Sheet, Fortune’s daily newsletter on the business of technology. Sign up here.
This article was updated Nov. 14 to correct Jeroen Tas’ title.