Amazon Web Services
In the early 2000s, Amazon faced a critical internal crisis. Its engineering teams spent 70% of their time on undifferentiated heavy-lifting tasks like IT and infrastructure problems instead of building customer-facing innovations. CTO Allan Vermeulen led the push for service-oriented architecture to solve this scaling issue. Matt Round, an engineering leader at the time, recommended maximizing autonomy for engineering teams and removing bureaucratic gatekeepers. The Infrastructure team, led by Tom Killalea, began running data centers on commodity Linux hardware to achieve fast, reliable, and cheap operations. By July 2002, Amazon.com Web Services launched its first web services under Colin Bryar's management. Over one hundred applications were built on top of it by 2004. This unexpected developer interest convinced Amazon that developers were hungry for more. Andy Jassy took over Bryar's portfolio in the summer of 2003 after Vermeulen declined the offer. Jassy mapped out a vision for an Internet OS made up of foundational infrastructure primitives. By fall 2003, databases, storage, and compute were identified as the first set of infrastructure pieces. Jeff Barr credits himself, Vermeulen, Jassy, Bezos, and others with coming up with the idea that would evolve into EC2, S3, and RDS. Jassy recalls the idea was the result of brainstorming for about a week with ten of the best technology minds and ten of the best product management minds. Werner Vogels cites Amazon's desire to make the process of invent, launch, reinvent, relaunch, start over, rinse, repeat as fast as possible. They broke down organizational structures with two-pizza teams and application structures with distributed systems. These changes ultimately paved way for the formation of AWS and its mission to expose all of the atomic-level pieces of the Amazon.com platform. Jassy assembled a founding team of 57 employees from a mix of engineering and business backgrounds to kick-start these initiatives. A majority of the hires came from outside the company. They included Jeff Lawson, the Twilio CEO; Adam Selipsky, the Tableau CEO; and Mikhail Seregine, a co-founder at Outschool. In late 2003, Chris Pinkham and Benjamin Black presented an internal paper describing a vision for Amazon's retail computing infrastructure. The paper described a system that was completely standardized, completely automated, and relied extensively on web services. Near the end of their paper, they mentioned the possibility of selling access to virtual servers as a service. Thereafter Pinkham, Willem van Biljon, and lead developer Christopher Brown developed the Amazon EC2 service. Their team operated out of Cape Town, South Africa.
November 2004 marked a turning point when AWS launched its first infrastructure service for public usage: Simple Queue Service. On the 14th of March 2006, AWS launched Amazon S3 cloud storage followed by EC2 in August 2006. Pi Corporation, a startup Paul Maritz co-founded, became the first beta-user of EC2 outside of Amazon. Microsoft was among EC2's first enterprise customers. Later that year SmugMug, one of the early AWS adopters, attributed savings of around US$400,000 in storage costs to S3. According to Vogels, S3 was built with 8 microservices when it launched in 2006 and had over 300 microservices by 2022. In September 2007, AWS announced its annual Start-up Challenge. The contest offered prizes worth $100,000 for entrepreneurs and software developers in the US using AWS services such as S3 and EC2 to build their businesses. The first edition saw participation from Justin.tv, which Amazon later acquired in 2014. Ooyala, an online media company, was the eventual winner. AWS offers two block-storage options: the EC2 Instance Store and the Elastic Block Store. Some Amazon EBS features help with data management, backups, and performance tuning. These include volume tagging to allow users to find and filter resources on the Console and CLI. Software-level RAID arrays enable creation of groups of volumes with high performance network throughput between them. Additional AWS services from this period included SimpleDB, Mechanical Turk, Elastic Beanstalk, Relational Database Service, DynamoDB, CloudWatch, Simple Workflow, CloudFront, and Availability Zones.
In November 2010, it was reported that all of Amazon.com's retail sites had migrated to AWS. Prior to 2012, AWS was considered a part of Amazon.com so its revenue was not delineated in financial statements. In that year industry watchers estimated AWS revenue to be over $1.5 billion. On the 27th of November 2012, AWS hosted its first major annual conference, re:Invent. The three-day event was held in Las Vegas because of its relatively cheaper connectivity with locations across the United States and the rest of the world. Andy Jassy and Werner Vogels presented keynotes, with Jeff Bezos joining Vogels for a fireside chat. AWS opened early registrations at US$1,099 per head for their customers from over 190 countries. On stage with Andy Jassy at the event which saw around 6000 attendees, Reed Hastings, CEO at Netflix, announced plans to migrate 100% of Netflix's infrastructure to AWS. To support industry-wide training and skills standardization, AWS began offering a certification program for computer engineers on the 30th of April 2013. Later that year, in October, AWS launched Activate, a program for start-ups worldwide to leverage AWS credits, third-party integrations, and free access to AWS experts. In 2014, AWS launched its partner network, AWS Partner Network. It focused on helping AWS-based companies grow and scale the success of their business with close collaboration and best practices. In January 2015, Amazon Web Services acquired Annapurna Labs, an Israel-based microelectronics company for a reported US$350, 370M. In April 2015, Amazon.com reported AWS was profitable, with sales of $1.57 billion in the first quarter of the year and $265 million of operating income. Founder Jeff Bezos described it as a fast-growing $5 billion business. Analysts described it as surprisingly more profitable than forecast. In October, Amazon.com said in its Q3 earnings report that AWS's operating income was $521 million, with operating margins at 25 percent. AWS's 2015 Q3 revenue was $2.1 billion, a 78% increase from 2014's Q3 revenue of $1.17 billion. 2015 Q4 revenue for the AWS segment increased 69.5% y/y to $2.4 billion with a 28.5% operating margin, giving AWS a $9.6 billion run rate. In 2015, Gartner estimated that AWS customers are deploying 10x more infrastructure on AWS than the combined adoption of the next 14 providers.
AWS has distinct operations in 38 geographical regions: nine in North America, two in South America, nine in Europe, four in the Middle East, one in Africa, thirteen in the Asia, Pacific, and three in Australia and New Zealand. Most AWS regions are enabled by default for AWS accounts. Regions introduced after the 20th of March 2019 are considered opt-in regions requiring users to explicitly enable them. For opt-in regions, Identity and Access Management resources such as users and roles are only propagated to the regions that are enabled. Each region is wholly contained within a single country and all its data and services stay within the designated region. Each region has multiple Availability Zones which consist of one or more discrete data centers. These zones have redundant power, networking, and connectivity housed in separate facilities. Availability Zones do not automatically provide additional scalability or redundancy since they are intentionally isolated from each other to prevent outages from spreading between zones. Several services can operate across Availability Zones while others can be configured to replicate across zones to spread demand and avoid downtime from failures. Amazon Web Services operated an estimated 1.4 million servers across 11 regions and 28 availability zones. The global network of AWS Edge locations consists of over 700 points of presence worldwide including locations in North America, Europe, Asia, Australia and New Zealand, Africa, and South America. The AWS Cloud spans 120 Availability Zones within 38 Geographic Regions with announced plans for 10 more Availability Zones and 3 more AWS Regions in the Kingdom of Saudi Arabia, Chile, and the AWS European Sovereign Cloud. AWS had announced the planned launch of six additional regions in Malaysia, Mexico, New Zealand, Thailand, Saudi Arabia, and the European Union. In mid March 2023, Amazon Web Services signed a cooperation agreement with the New Zealand Government to build large data centers in New Zealand.
In October 2013, AWS was awarded a $600M contract with the CIA. By 2019, it was reported that more than 80% of Germany's listed DAX companies used AWS. In August 2019, the U.S. Navy said it moved 72,000 users from six commands to an AWS cloud system as a first step toward pushing all its data and analytics onto the cloud. In January 2021, Amazon announced that it would suspend Parler from Amazon Web Services stating Parler hosted violent content that violates its terms of service. Later in 2021, DISH Network announced it would develop and launch its 5G network on AWS. It was also reported that spy agencies and government departments in the UK such as GCHQ, MI5, MI6, and the Ministry of Defence contracted AWS to host their classified materials. In 2022, Amazon shared a $9 billion contract from the United States Department of Defense for cloud computing with Google, Microsoft, and Oracle. AWS won a $581 million contract from the U.S. Air Force in January 2026 to provide cloud services and specific Amazon data centers as part of the Cloud One Program. Multiple financial services firms have shifted to AWS in some form. Notable customers include NASA and the Obama presidential campaign of 2012. On the 20th of April 2011, AWS suffered a major outage where parts of the Elastic Block Store service became stuck and could not fulfill read/write requests. It took at least two days for the service to be fully restored. On the 29th of June 2012, several websites relying on Amazon Web Services were taken offline due to a severe storm in Northern Virginia where AWS's largest data center cluster is located. On the 22nd of October 2012, a major outage occurred affecting many sites including Reddit, Foursquare, and Pinterest. The cause was a memory leak bug in an operational data collection agent. On the 24th of December 2012, AWS suffered another outage causing websites such as Netflix to be unavailable for customers in the Northeastern United States. AWS cited their Elastic Load Balancing service as the cause.
In 2014, AWS claimed its aim was to achieve 100% renewable energy usage in the future. In the United States, AWS's partnerships with renewable energy providers included Community Energy of Virginia to support the US East region. Pattern Development joined in January 2015 to construct and operate Amazon Wind Farm Fowler Ridge. Iberdrola Renewables LLC joined in July 2015 to construct and operate Amazon Wind Farm US East. EDP Renewables North America joined in November 2015 to construct and operate Amazon Wind Farm US Central. Tesla Motors applied battery storage technology to address power needs in the US West Northern California region. In 2016, Greenpeace assessed major tech companies based on their level of clean energy usage. The group gave AWS an overall C grade. Greenpeace credited AWS for its advances toward greener computing in recent years and its plans to launch multiple wind and solar farms across the United States. The organization stated that Amazon is opaque about its carbon footprint. In January 2021, AWS joined an industry pledge to achieve climate neutrality of data centers by 2030 known as the Climate Neutral Data Centre Pact. As of 2023, Amazon as a whole is the largest corporate purchaser of renewable energy in the world. It has held this position since 2020 and has a global portfolio of over 20 GW of renewable energy capacity. In 2022, 90% of all Amazon operations including data centers were powered by renewables. The US Department of Homeland Security employed software ATLAS which runs on Amazon Cloud. It scanned more than 16.5 million records of naturalized Americans and flagged approximately 124,000 of them for manual analysis and review by USCIS officers regarding denaturalization. Some of the scanned data came from the Terrorist Screening Database and the National Crime Information Center. The algorithm and criteria for the algorithm were secret. Amazon faced protests from its own employees and activists for the anti-migrant collaboration with authorities.
Common questions
When did Amazon Web Services launch its first web services?
Amazon.com Web Services launched its first web services in July 2002 under the management of Colin Bryar. By 2004, over one hundred applications were built on top of this initial infrastructure.
Who founded Amazon Web Services and when was it officially established as a public service?
Andy Jassy took over the portfolio from Colin Bryar in the summer of 2003 to map out the vision for AWS. The Infrastructure team led by Tom Killalea began operations using commodity Linux hardware, and Simple Queue Service became the first infrastructure service available for public usage in November 2004.
What major outage occurred at Amazon Web Services on the 21st of April 2011?
On the 21st of April 2011, parts of the Elastic Block Store service became stuck and could not fulfill read or write requests. It took at least two days for the service to be fully restored after this event.
How many geographical regions does Amazon Web Services operate in as of 2023?
AWS has distinct operations in 38 geographical regions including nine in North America, nine in Europe, and thirteen in Asia Pacific. Regions introduced after the 20th of March 2019 are considered opt-in regions requiring users to explicitly enable them.
Which government agencies have contracted with Amazon Web Services for cloud computing services?
Amazon Web Services was awarded a $600M contract with the CIA in October 2013 and signed a $9 billion contract from the United States Department of Defense in 2022 alongside Google and Microsoft. Spy agencies such as GCHQ, MI5, and MI6 in the UK also contracted AWS to host their classified materials.