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AWS CEO Adam Selipsky On Gartner Magic Quadrant Allegations, Andreessen Horowitz Cloud Cost Claims And Egress Fees

Donna Goodison

Amazon Web Services CEO Adam Selipsky, in an exclusive interview with CRN, disputed Gartner Magic Quadrant allegations that AWS uses high-pressure sales tactics; called the controversial Andreessen Horowitz report on the cost of cloud computing “highly misguided” and referred to AWS egress fees as an issue that customers have not raised in any “material way.”

On AWS’ Stand Against ‘Technical Lock-In’

We don’t believe in trying to create technical lock-in. We want customers to be here because they want to be here. And in fact, philosophically, we believe that the less lock-in there is, the more willing and eager customers will be to move to the cloud. In addition, I think our partner ecosystem is important. We have a ton of partners—we have ISVs like NetApp, but there are many, many others—with whom we partner to enable customers to run workloads in multiple places.

We have a ton of systems integrator partners who are more than capable of working with customers to help them migrate workloads to wherever those customers want them to be. And just like we think it’s our job to serve customers, we think it’s our SI partners’ job to serve customers, and they’re going to help them run their workloads wherever customers want those workloads to be.

On Claims That AWS Egress And Bandwidth Fees Are Excessive

This is not an issue that customers have raised with us in any material way, and that’s because overall AWS pricing is extremely low. And frankly, it’s revolutionized the IT costs of almost all of our customers, compared to what they’ve traditionally paid for a wide swath of their hardware, software, networking or data center services that they consume.

AWS has lowered costs well over 100 times in our history. We have a really strong track record of always looking to innovate to lower our own costs and then to lower the price that we charge for customers.

If you look specifically at providing bandwidth, I think there’s been a lot of misinformation out there. The majority of costs required to transfer data is actually in fixed network equipment. It’s not about the variable bandwidth of moving a bit.

AWS remains extremely cost-following in the way that we choose to price in each of our services. It’s really a philosophy that we have. If you look at how we price across most of our 200-plus services—where do we charge for storage and where do we charge for throughput, and where do we charge for compute and where do we charge for database cycles—it becomes pretty obvious that we’re trying to only charge customers for the resources that they actually consume in a very fair way.

We are going to continue to innovate, and I imagine in many areas across AWS that we’ll continue to continue to lower our prices over time as we lower our costs.

 
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