rebelutionary / 2.0

Bezos joins the Light Horse / 2006 Nov 09

Tim O'Reilly is interviewing Jeff Bezos right now about Amazon's web services plans. I got up especially early this morning to be here because to me EC2 was the most exciting tech announcement of the past 12 months.

In terms of costs, EC2 costs $0.10c per compute hour, which works out at around $70 / month, with "infinite" scalability.

Jeff puts the economics in much clearer perspective than I do:

"Imagine 1 server for a month for $70, or 700 servers for an hour for $70."

Incredible.

So what is the connection between Amazon and selling server infrastructure? Bezos is claiming that what Amazon does well is not sell books or CDs, it's measure dollars. They calculate every dollar carefully, on sales, on shipping, on infrastructure. All they're doing is taking their expertise in those areas and applying it to heterogeneous web infrastructure.

From that point of view, it does make a lot more sense. If you can calculate how to make $0.50 a 100 million times on shipping a book, you can calculate how to make $0.01 / compute hour 100 million times on virtualised server hardware.

"You've tallked about us very nicely as the dark horse in this area (developer infrastructure), but I think we're more of the opposite. Whatever that is. We're more of a light coloured horse."

Apparently Linden Labs used S3 to serve downloads of their latest Second Life update and it all worked very smoothly, allowing them to stream tens of thousands of downloads with no additional permanent server hardware.

Mashery (TechCrunch review) is one of the clever Web 2.0 companies that's come along recently, and from their FAQ they actually use EC2 and S3 behind the scenes to scale their web services offering. Smart fellas.

It's going to be a fascinating year as people start exploring this.

Jeff seemed to be a very smart guy (obviously he is) but he lost a little credibility with me right at the end with his comments on 37 Signals (where he is the investor). Apparently he invested because, I quote "These are some of the most humble guys I've ever met." That was met by guffaws of laughter from the audience. 37 Signals does a fantastic job of building small, simple apps but if anyone's read their blog "humble" is not the word I'd use.

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