The Year of Web Services

Could this finally be the year that Amazon see some competition in the web services market? I got thinking about this while reading this excellent post from Dave Winer this afternoon. Dave believes that it makes sense for Google to release their offering as a free service and makes a good argument for doing so.

So we’ll have Amazon and Google in this space. There’s no way that Microsoft can ignore Google or Amazon. Anything Google does, Microsoft has to follow. I’ve already written about what a nightmare this could be for Microsoft so I won’t rehash it here. Suffice it to say that Microsoft will be playing by Google’s rules if Google can beat them to the punch by offering a free or nearly free service. Amazon’s services have already lowed costs substantially but I expect many hold outs will jump on the Google bandwagon.

Few companies have the resources and cash to build out such massive data centers like Amazon, Google and Microsoft will do. We all benefit when three large, competitive companies fight for our business.

If I were handicapping the race I’d put Amazon ahead of the pack with Google a close second and Microsoft a distant third. If Ray Ozzie were leading Microsoft, I’d give them better odds but it’s hard to imagine Balmer fully embracing services that could erode Windows and/or Office margins. Microsoft hasn’t shown it possesses the guts to release online versions of Word, Excel or Powerpoint. I keep hearing rumors this will happen but it’s hard to fathom what took them so long. Someone is asleep at the wheel in Redmond.

I’m using Amazon’s Simple Storage Service in conjunction with Jungle Disk and I love it! But I don’t feel locked in to their service. If Google or Microsoft put out a better product, I’ll move over. But does it have to be free? As Winer mentions, Google could benefit from having potential acquisitions already running their products and services on the Google Web Services platform, thereby removing one of the major hurdles to any purchase. Giving the service would make sense in this case.

I wonder if one reason Microsoft is willing to overpay for Yahoo is they feel Yahoo could catapult them into a better position to compete in this space with Google and Amazon? There’s power in combining Microsoft’s cash and human resources with Yahoo’s open source platform. 

Read Om Malik’s interview with Ray Ozzie where they discuss web services.

2 thoughts on “The Year of Web Services

  1. Bret, great post. Just want to be clear, I’m sure the reason Microsoft wants to buy Yahoo is to turn it into a developer platform for running AWS-style hosted apps using open source software as the basis. It’s a way for them to buy a leading position in the LAMP space and start at a running pace.

    Being a dev platofmr is in Microsoft’s DNA. They can’t not look at the world that way.


  2. Dave, thank you for the clarification.

    It’s interesting to think of Microsoft spending so much money to buy a position into LAMP. Not something many would have thought possible just a few years ago.


Comments are closed.