Key Markers Coming Out of 2018 AWS re:Invent
Bob Kelly, Managing Partner
Industry events like last week’s Amazon re:invent are always markers, markers of technological advances, markers of customer acceptance/adoption and markers of competitive dynamics in the marketplace. Having been in tech for nearly 25 years I have seen my fair share of these markers (anyone remember networld+interop or the Windows 95 launch?) but none was as visible as Amazon’s announcement — what I call marker 1 — that they would deliver Amazon software inside customers own data centers via AWS Outposts (love the name btw).
Why is this so unusual? First, this is an admission by AWS of the reality of the complexity of enterprise technology investments, the stickiness of legacy applications and infrastructure, as well as the cost of moving or perhaps lack of value proposition of moving every application or asset to the public cloud. Given the rabid AWS customer focus this is also a signal that customers have been clear with Amazon that they want an infrastructure across premises but also want the benefit of consistency of management security and APIs in their own data centers — dare I say it, a hybrid cloud. That is marker 2.
The simple truth is that enterprise customer needs for mission critical workloads are just so much more complex than the first movers/workloads onto AWS; which were startups and non-mission critical workloads. Enterprise customers make multi year –sometimes decades-long — investments and clearly have given Amazon feedback that “cloud only” is not viable anytime in the near future for the entire enterprise estate. Enterprise customers want the technical and business advantages of the public cloud but practical realities of technology, business processes and needs, talent of their own teams and many more factors mean that moving every workload and simply turning off the lights of their own investments does not make business, technical or economic sense. And that leads to marker 3.
Microsoft and IBM, in particular, which both have decades longer experience working with and supporting enterprise customers, have been banging the hybrid drum for several years, Microsoft with Azure Stack and IBM most recently doubling down with the RedHat acquisition. Both companies clearly recognized, some might say selfishly given their footprint within the enterprise on-premises estate, the practical realities of the business, technical and economic challenges the move to “cloud only” would present to large complex customers. Each has been clear in their positioning to the marketplace that hybrid is the safest and most practical path to the cloud. This week the recognized leader of public cloud has accepted this and has thrown down the gauntlet to its competitors and clearly signaled its intention to win the new reality of cloud.
Much as my colleague Scott Coleman suggested in his blog post a couple weeks back, it sure looks like the 2019 cloud battle will involve on-premises as a core part of the enterprise cloud vendors’ strategies. The reality in enterprise is complexity and Amazon recognizing this via AWS Outposts is both surprising given their heretofore “cloud only” mantra, but also a clear indication that they are seriously focused on winning even it means taking a little pie to the face. Many of Ignition’s investments, such as Trifacta, Aviatrix, Skytap and Chef, are squarely focused on this reality and it is good to see Amazon join the party.