Amazon: The Digital Cost Cutting Quest

April 30, 2015

Nope, Amazon is not playing games. With its cloud services getting some love, the company wants to wallow in affection. I read “Amazon Pays $20M-$50M for ClusterK, the Startup That Can Run Apps on AWS at 10% of the Regular Price.” Who knows if the 10 percent figure is fudge.

Who cares?

I believe that Amazon’s cloud competitors will perk up. Hewlett Packard, IBM, and Microsoft have big cloud plans. Microsoft advertises a cloud that endures tough weather. Okay.

But the issue is cost. Microsoft gives stuff away. HP does the mitosis thing. IBM pumps out PR for Watson authored cookbooks AND quantum computing chips.

Amazon, on the other hand, continues to push for the undisputed crown as the digital Wal-Mart. My hunch is that price competition may be more important than the cloud prices its competitors are offering. Perception is important. Do you want lower costs or free Word, two HPs, and one collection of IBM financial reports. I go with lower costs.

Stephen E Arnold, April 30, 2015


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