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Will AWS IQ Short-Circuit The Channel By Powering A Gig Economy?

Some partners of the leading cloud provider worry the new matchmaking service will disintermediate AWS solution providers by connecting SMB customers directly to contract workers, potentially driving down billable rates

 

Amazon Web Services introduced a service this week to match cloud customers with third-party AWS professionals, but it's likely not the boon to the channel that it may first appear.

Some partners serving the SMB market worry the service, AWS IQ, will disintermediate their practices by enabling those customers to directly connect with and engage contract workers—in effect helping spur a gig economy for professional services.

"The platform is obviously aimed more at independent consultants than established partners," said one AWS partner familiar with the new service.

[Related: The Top Things To Know About Becoming An AWS Partner]

AWS Chief Evangelist Jeff Barr introduced AWS IQ in the AWS blog as "a new service that will help you to engage with AWS Certified third party experts for project work."

The service will be particularly useful to small and medium-sized businesses, Barr said.

"Regardless of the size of your organization, AWS IQ will let you quickly & securely find, engage, and pay AWS Certified experts for hands-on help," he said. "All of the experts have active AWS Associate, Professional, or Specialty Certifications, and are ready & willing to help you."

As one AWS Partner Network member pointed out to CRN, only individuals—not companies—earn those three levels of certifications. Companies can only achieve partner program tiers.

And that may be the rub for the channel.

"It's going to further commoditize highly in-demand skill sets and push the industry closer to the gig economy," said another AWS partner who serves the mid-market.

While Amazon gets its 18 percent cut (15 percent of the service provider's fee and a 3 percent upcharge to the job poster), AWS IQ could drive down billable rates for its channel partners, he said.

There is the potential upside that AWS IQ could help partners keep their employees busy between projects, he said.

But that might be a process that's too cumbersome to take advantage of, he said, because "each profile is actually created and managed by the individual engineer rather than centrally managed by the employer."

"The messaging around this being a tool for AWS partners might simply be marketing spin to avoid spooking partners about their possible disintermediation," he said.

As Barr explained, customers can go to AWS IQ to describe their projects, and then experts reply with proposals. The parties can chat via video or text, and once they agree on a price AWS will automatically generate the contract, enable the provider to access the customer's account, and handle all billing.

"AWS IQ is integrated with your AWS account and your AWS bill. If you are making use of the services of an expert, AWS IQ lets you grant, monitor, and control access to your AWS Account. You can also pay the expert at the conclusion of each project milestone," Barr said.

Those are all the hallmarks of a service that powers a gig economy, a la Uber and Airbnb, partners told CRN.

Several hundred "would-be experts" have already been reviewed and accepted, Barr said, and "we’ll continue to add more as quickly as possible."

The projects they engage in through AWS IQ must only have a minimum value of one dollar. For now, the experts must live in the U.S.

But it's unclear how the service and ecosystem it creates will evolve. AWS did not reply to a request to comment on how the service could impact partners.

"We have a long roadmap for this cool new service, but we are eager to get your feedback and will use it to drive our prioritization process," Barr said.

The gig economy, constituting an increasing number of freelancers and independent contractors who perform jobs once handled by full-time employees, accounts for 34 percent of the U.S. workforce. That figure is expected to climb to 43 percent by 2020, according to a 2017 survey by software vendor Intuit.

Ride-sharing services like Uber and Lyft, which have disrupted the taxi industry, are among the most visible enablers of that new model, but it also has been extending rapidly into the IT industry.

In many ways, the gig economy has been of benefit to the channel by making it easier for solution providers to hire skilled engineers with specific certifications for short-duration jobs, especially in remote locations in which they don't staff full-time employees.

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