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TDWI Upside - Where Data Means Business

Another Quarter of Record Results for Amazon Web Services

According to the latest revenue reports, Amazon Web Services is a bona fide giant in data management and analytics, and it's poised to get even bigger.

Another quarter, another round of record results for Amazon Web Services (AWS).

For Q2, AWS generated $2.9 billion in revenue -- a 58 percent increase, year over year. AWS' Q2 performance was also a 16 percent improvement over Q1, which was itself a record-breaking success.

Operating income from AWS accounted for 55 percent of Amazon's total operating income in Q2.

True to form, Amazon officials didn't break out revenues for the data management and analytics technologies -- Amazon Relational Database Service (RDS), Amazon Aurora, Amazon Redshift, and Amazon Elastic MapReduce -- that help to buoy

Officials even declined to discuss the rate of workload shift from the on-premises enterprise to AWS -- despite being asked to do so by Ross Sandler of Deutsche Bank. "We still think [it's] very early," said Brian Olsavsky, Amazon's senior vice president and CFO.

Amazon's AWS financials aren't completely opaque, however.

Hadoop Users Make Amazon a Major Data Player

At this month's Pacific Northwest BI Summit, held in Grant's Pass, Oregon, Gartner vice president Merv Adrian discussed the outsized role Amazon and AWS now play in data management and analytics.

According to Adrian, Amazon is a bona fide giant: it already sells more Hadoop capacity and hosts more Hadoop instances than every other commercial player combined -- that includes Hadoop pure-plays Cloudera, Hortonworks, and MapR Technologies. It also includes vendors such as IBM and Microsoft, which market their own distributions of Hadoop.

"There is a helluva lot more Amazon out there than most of us thought. We all kind of knew it was going on but [Amazon was] so opaque in their financial reporting," Adrian told attendees.

"[A] year ago ... if you looked at the published SEC filings from Amazon, there was one line from AWS, and [all AWS services were combined into] one number.

"Today, [Amazon] has more users of Hadoop than all of the other vendors in the market combined. Period. There are thousands of active users with [Amazon's] EMR [Elastic MapReduce]," he continued. "The most any of the indies will tell you is 'we're getting close to 1,000 [commercial users] now.' We have some 800 to 900 [users] numbers from some of the pure-play guys, and IBM, Microsoft, none of them have given us specific numbers publicly about what they have."

Aurora Is Still AWS' Rising Star

Adrian also touched upon the success of Amazon's Aurora, which helped buoy Amazon's DBMS-related revenues to almost $834 million last year.

For years, Adrian noted, Teradata has clung to the #5 position in Gartner's RDBMS revenue rankings; this year, he suggested, the data warehousing giant is in danger of being bumped out of the top five by Amazon, chiefly on the strength of Aurora.

Phil Hardin, Amazon's director of investor relations, described Aurora last quarter as "[t]he fastest-growing product in [the] history" of AWS.

Increased Cloud Capacity Drives Even More Growth

Amazon and AWS are poised for additional growth. In May Amazon significantly raised the bar for most cloud capacity with XI -- a monster new virtual machine (VM) configuration for its Elastic Compute Cloud service. X1 VM instances can be configured with up to 2 TB of RAM and 128 virtual CPUs. Amazon specifically pitched X1 for SAP's HANA in-memory database.

In yesterday's earnings press release, Amazon described X1 as "ideal for running in-memory databases like SAP HANA, big data processing engines like Apache Spark or Presto, and high performance computing (HPC) workloads."

Amazon also offers SAP's HANA Cloud Platform via AWS. HANA Cloud Platform is a platform-as-a-service variant of SAP's on-premises business applications. Amazon says clients such as GE Oil & Gas, Kellogg Company, Brooks Brothers, and Lionsgate are using SAP on AWS.

Finally, the online giant announced that AWS has achieved FedRAMP high compliance certification, which means U.S. government agencies can now use AWS to host sensitive information.

About the Author

Stephen Swoyer is a technology writer with 20 years of experience. His writing has focused on business intelligence, data warehousing, and analytics for almost 15 years. Swoyer has an abiding interest in tech, but he’s particularly intrigued by the thorny people and process problems technology vendors never, ever want to talk about. You can contact him at [email protected].

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