Amazon Web Services to offer satellite service
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Amazon Web Services to offer satellite service

Ecommerce giant Amazon is having a strong showing this year. While not immune to the tech backlash that has roiled markets, and unable to keep hold of the $1 trillion market cap it achieved months ago, the company is nonetheless outperforming. Its share price has appreciated by 38% year to date, with 8% of that coming in the last five days, as investors react to a stellar holiday season kick-off that saw the five-day period from Thanksgiving to Cyber Monday break records. Now, Amazon has more good news: its most exciting division (cloud computing) is preparing to roll out new services.

Amazon’s share price soared on the back of a positive start to the holiday season

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Source: Yahoo Finance

Amazon said that its cloud computing arm – Amazon Web Services – will start offering a service that makes it easier to download data from satellites and store it in the cloud. The service, called AWS Ground Station, uses satellite ground stations to connect with satellites and send info to the company’s data centres, where it can be analysed and transferred into the cloud. The company said that the service was a direct response to feedback from customers, who claimed that it was too expensive to build or rent ground stations and send data where they wanted it to go.

Amazon Web Services is the market leader in cloud computing. The reasons for that are simple: they did it well, and they did it first. But now, the challenge is maintaining that lead. New services coming in response to customer demands is a sure-fire way to meet that challenge.

According to Gartner Inc., cloud computing is set to grow to $278 billion globally by 2021. That’s up from $176 billion this year. Amazon owns a little more than 10% of that – last year, it managed to bring in $17.5 billion. Given its head start, the speed at which AWS is growing, and the speed at which cloud hosting more generally is growing, the division could one day become the jewel in Amazon’s crown.

Disclosure
Dominion holds Amazon in its Global Trends Ecommerce Fund.


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