Enterprise

In CEO Adam Selipsky’s first re:Invent keynote, AWS spent more time on the past than the future

AWS introduced a new version of its Graviton server processor and new serverless tools to stand out in the highly competitive data analytics market, but also took a trip down enterprise memory lane.

Adam Selipsky, AWS CEO, speaks with Doug Yeum, Head of AWS Partner Organization during the AWS Global Partner Summit Keynote at AWS re:Invent in Las Vegas.

It’s been 15 years since AWS launched its first cloud service to take the enterprise tech world by storm.

Photo: AWS

AWS is having a big anniversary year; it’s been 15 years since it launched its first cloud service to take the enterprise tech world by storm, and 10 years since it started gathering early converts to cloud computing in Las Vegas for its annual re:Invent conference. In his first address to that group, CEO Adam Selipsky looked back even further.

Invoking the Crimean War, the Tuskegee Airmen and 1930s Stanford basketball legend Hank Luisetti during his two-hour speech, Selipsky sought to paint a picture of AWS and its customers as “pathfinders” who took risks to completely change the way enterprise tech is bought and sold. While that was certainly true years ago, the new services and customer examples highlighted Tuesday are evidence of a maturing AWS, in which incremental progress that cloud laggards can digest rates top billing during its most important event of the year.

“In the 15 years since we launched AWS, the cloud has become not just another tech revolution, but an enabler of a fundamental shift in the way that businesses actually function,” Selipsky said. “There's no industry that hasn't been touched, and no business that can't be radically disrupted.”

The most noteworthy announcement Tuesday was a new generation of AWS’ Graviton Arm server chip, which was definitely a game changer for server customers when it was first introduced three years ago. The Graviton instances offer cloud customers a compelling price-performance argument compared to Intel and AMD’s x86 server chips, and Selipsky said Graviton3 will deliver 25% better performance than the current version, Graviton2, while using 60% less energy.

The company said it would shift several key data analytics tools — including Redshift, EMR, MSK and Kinesis — to a serverless model, where customers will only pay for what they use and where AWS will automatically manage the hardware resources used by those services. Businesses often find it hard to anticipate how much data-processing capacity they’ll need across a given week or month, which means they tend to over-provision the computing resources they’ll need.

Serverless technologies have been a big part of AWS’ product strategy over the last several years. They promise to make key cloud technologies like computing, container management and now data analytics easier to use on a day-to-day basis, while also making it harder for customers to switch away to competing services given the amount of upfront custom code that’s required to use these services.

Still, there are lots of companies willing to make that tradeoff. For Linda Jojo, executive vice president of technology and chief digital officer for United Airlines, the swift disruption caused by lockdown orders around the globe at the start of the pandemic forced United to rethink its approach.

“And it also became painfully obvious that not only could our current platforms not scale up, they couldn't scale down, either” as United scrambled to cancel flights and refund customers, Jojo said during the keynote address.

AWS also announced Amazon SageMaker Canvas, a no-code update to its SageMaker AI service that helps companies develop and train AI models. Canvas will allow people without hardcore data-science knowledge build and train AI models without having to write any code, which could both improve productivity and unleash a parade of poorly developed data-driven applications that fail to incorporate sufficient privacy guardrails.

Still, it’s clear that AWS has shifted its focus from the scrappy upstarts that built huge companies around its services in the wake of the Great Recession — companies like Airbnb, Pinterest and Lyft — toward older companies like United and 3M, who make up the bulk of the new cloud business that Microsoft and Google are also targeting.

Selipsky, one of the first sales and marketing leaders of AWS from its initial launch, recalled the pre-AWS enterprise tech market as “dominated by the old-guard vendors who loved the expense and the lock in … we knew there had to be a better path forward for all of us.”

But 15 years later, AWS customers love to complain about out-of-control cloud costs, and the higher-level managed services that the company has focused on delivering over the past several years almost guarantee customer lock-in. It was an interesting parallel to draw, especially considering AWS recorded over $45 billion in revenue last year and is growing even faster this year.

Selipsky’s main job over the next year, as only the second CEO in the history of AWS, will be making sure AWS doesn’t fall into the old-guard vendor mentality it so successfully overturned more than a decade ago. However transformational AWS was back in those days, it chose a rather conservative path for the most important two hours of its year.

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