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Did Amazon Just Damage Their Ecosystem?

Posted by Bob Warfield on January 10, 2009

There’s a lot of back and forth over whether Amazon has just damaged some of their ecosystem partners by launching the AWS Console, which provides an easy way to control your Amazon Cloud usage from a web browser. 

Elastic Vapor trumpets, “Amazon Crushes Ecosystem.” 

GigaOm says the new offering competes with RightScale, Elastra, and Enomoly, but doesn’t crush them out of existence.

This is not the first time this has happened.  Elastra and others were queing up to solve EC2′s persistence problem and Amazon delivered Elastic Block Store and made the whole issue moot.

So what’s the deal?  Is Amazon doing evil to its ecosystem?  Have they violated my oft-repeated dictum that platform vendors have to act like Switzerland?  Is this good for the competition, as Paul Lancaster Business Development Manager at GoGrid says:

“Better opportunities for other cloud vendors as AWS console de-values partners who build business on the platform. Good news for the competition.”

I don’t think Amazon has done evil and I do think ecosystem players need to position themselves to expect this sort of thing.  Amazon needs to do whatever is necessary to make adoption of its platform easy.  Ultimately, that will grow the ecosystem too.  Yes, there was some pretty low hanging fruit out there in the form of gaps in Amazon’s initial offering.  EC2 persistence was one.  Having only a command line interface and no web client (addressed by this AWS Console announcement) is another.  It’s fine for the ecosystem to be nimble about nailing such opportunities early on, but they can’t very well expect Amazon to let them hold on to franchises that are pivotal to Amazon’s own success as a platform.  As such, I don’t see Amazon’s actions as evil.  I think the ecosystem has to expect this sort of thing. 

In fact, all indications are that companies like RightScale were in the loop that the announcement was coming.  That’s a pretty clear indication Amazon didn’t mean to do evil to them, but wanted them to have a chance to prepare themselves and respond. 

When you’re riding the wave that is someone else’s ecosystem, it behooves you to stay well informed about their direction, anticipate they’ll fill in their functionality, and keep pushing the envelope to stay ahead of them.  If your ecosystem addition was built by a small team in record time to solve an obvious need, keep the thought in the back of your mind that it may just have been a little too easy and start looking for something harder to do to add value.

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2 Responses to “Did Amazon Just Damage Their Ecosystem?”

  1. rnugent said

    We actually breathed a sigh of relief when we saw it. There is a LOT of room left in the cloud management/value add space and it’s clear AMZN is competing with MSFT not us little guys. Yes, low hanging fruit is not a safe business plan, but nascent markets have lots of “Ah Ha” business opportunities in them in the early stages…

    Ray

  2. perpetapaul said

    Bob – You are right, they are not “evil”. The partners have to know that Amazon will take these actions. It’s a similar case to the automative or computer aftermarkets. If some add-on gets to be really popular, the auto/computer industry will make it a part of their next offerings.

    I think the best partners for Amazon (and other cloud platforms) will be to focus on building services on top of the cloud offering to remove people from that level. That is what we are focusing on.

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