Updated Monday, Feb. 18 at 3 pm: Adds information about Amazon's premium support services.
This is an oxymoron. IBM thinks the lack of customer service is restricting the growth of cloud applications. It is mistaken.
What's happening in the market is simpler. Price sells cloud.Amazon.com (AMZN) has been dominating the public cloud market by pushing prices as close to its costs as possible. Other vendors have been forced to follow, and buyers of cloud services have come to see cloud technology as dirt cheap. But in making its service as cheap as possible, Amazon has been forced to make its cloud "self-service." You buy it online, you figure out how to use it for yourself. Amazon does offer premium support , which includes telephone support and direct contact with its engineers. Prices are based on monthly minimums or a percentage of your monthly bill, whichever is greater. This starts at $100/month, on services that cost just pennies an hour. Some of Amazon's biggest customers, such as Netflix (NFLX), are now offering open-source tools to make using Amazon easier, Gigaom writes. Netflix is doing this because it's happy with Amazon's self-service, but would like the help of other programmers in making it better. Judging by the crowd at its Feb. 6 meet-up on cloud tools, which Gigaom covered, it has a receptive audience. There's no altruism here. In addition to using the open-source process to make its use of Amazon better, Netflix is using the same process to seek alternatives to Amazon. But it's not finding many -- not near Amazon's price. Amazon's aggressiveness is creating casualties. Rackspace (RAX), the high-flying cloud host that was the original sponsor of OpenStack, the open source cloud system, fell hard this week as its growth slowed. Amazon's competitors in the public cloud aren't gaining traction because Amazon's prices are just so good. How good? Start with using Amazon services for 750 hours free. You can't beat free. The aim of Amazon's pricing, of course, is to push customers toward reserving the service, paying for it in advance. The highest price I could find on its reserved price list, eight extra-large high-storage systems, cost under $17,000 to reserve for up to three years, and just 76 cents/hour to use. Seventy-six cents an hour.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV