The 4 Most Interesting Things From Amazon’s Cloud Extravaganza

April 20, 2017, 12:44 AM UTC

Amazon’s strategy to dominate the business of cloud computing involves a treasure chest of coding tools.

The company’s cloud computing arm held a conference Wednesday in San Francisco intended to show businesses its latest tech.

When Amazon Web Services (AMZN) debuted over a decade ago, few companies bought computing resources on-demand from another. Since then, it has become a huge industry, and AWS has become the leading service.

But AWS faces increased competition from Microsoft (MSFT) and Google (GOOG), which have been investing heavily in their rival services. They too want a piece of the fast-growing cloud business, which is upending the data center and software industries.

Here’s four interesting tidbits from the conference.

Amazon wants developers to consider the voice

Werner Vogels, Amazon’s technology chief, said that the voice recognition technology that powers Amazon’s Alexa digital assistant is now available for outside developers to build apps. Amazon is hoping that companies will choose its service for building software because of the popularity of Alexa, which powers Amazon’s Echo Internet-connected speaker that listens to and responds to a person’s voice.

Google (GOOG) and Microsoft (MSFT) are also pushing their voice technologies. But Ariel Kelman, vice president of marketing for AWS, told Fortune that some of the engineers who worked on Alexa also contributed to AWS’s Lex voice-recognition service, which helped Amazon “share the cost for investment,” thus presumably, saving Amazon money and developer resources. Amazon is hoping that developers will be swayed to use its voice-recognition tech for their apps because that same underlying tech has been steadily improving as Alexa consumes more user data.

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Amazon digs into Microsoft and Oracle

Vogels bragged about AWS’s growing business, and reiterated how the cloud computing unit has a $14 billion annual run rate as of its last quarterly report. Companies calculate their annual run rates by multiplying their latest quarterly revenue by four; the results are intended to project the future performance of their businesses based on their current quarters.

Vogels took aim at AWS’s rivals and said that while AWS is rising, “Many, like Microsoft and Oracle, are actually retreating.” He then showed a slide to the audience that showed the growth in revenue by competitors like Oracle, Microsoft, IBM, Cisco, and Hewlett Packard Enterprise. They appeared to grow more slowly in the latest quarter based on their year-over-year sales during the time period. AWS, of course, led all comers.

Vogel’s comparison wasn’t exactly fair, however. He contrasted each companies’ overall revenue growth rate—not merely for their cloud businesses—with that of AWS. Yes, the overall businesses of AWS’ rivals are growing more slowly because of their size and their legacy technologies that are falling out of favor with customers. But their cloud businesses are rising rapidly as well, companies like Microsoft and Oracle claim. It should be noted that there is not standard accounting method for cloud computing.

Amazon has a new CodeStar

Amazon is competing in the cloud by offering services that it claims let customers develop software more easily by removing much of the minutia of managing big coding projects. For example, Amazon’s new CodeStar is a software development starter kit with a design that resembles editing software used by non-techies. CodeStar is free, Kelman said, but its users must pay for other AWS services like security tools that power it. The trade-off is that customers aren’t able to use services from other vendors, at least for now, Kelman said, which is significant if coders don’t want to use only AWS infrastructure tools.

Amazon Continues to take digs at Oracle

Just a few weeks ago during a call with analysts, Oracle executive chairman Larry Ellison took a shot at Amazon by claiming that Oracle’s overhauled cloud computing service is better and cheaper than AWS. On Wednesday, AWS CEO Andy Jassy fired back by saying that over the last few decades, the database market “has been a lonely place for customers.”

Oracle, of course, generates the bulk of its sales by selling databases. Jassy dug the knife in a little deeper by saying that businesses “have been locked into companies that aren’t so customer friendly.”

“I think customers are sick of it,” Jassy said.

In the IT world, customers may fear being “locked in” to using any one particular vendor. If they rely too much on one vendor’s technology, it can be difficult to ever leave them to use another.

Still, as AWS has grown over the years, it’s now battling the perception that it too is “locking in” customers with its cloud services. Jassy acknowledged the perception and said, “When you look at the cloud, it’s not like being locked in by Oracle.”

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He said that AWS has several tools for companies to migrate their data “in or out of AWS” and that “it is much easier to move away from something like the cloud than from some of those old software services.”

However, moving from AWS or most other cloud services is likely to be expensive depending on how much data and infrastructure a company has. It’s just a matter of whether it’s worth the expense.

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