Amazon.com Inc’s cloud business, Amazon Web Services, plans to set up one of its ‘pop-up lofts’ in Bengaluru as it looks to accelerate growth in India, a top company executive said.
The lofts, which offer everything from open workspaces to consulting to networking services, are essentially hubs for entrepreneurs.
“We are looking closely at Bengaluru to set up a loft. Obviously because of the startups, it is one of the places we are looking at very hard,” Andy Jassy, chief executive officer at Amazon Web Services, told ET.
Some of the lofts are temporary like those in London and Tel Aviv but the ones in New York and San Francisco are permanent. Jassy, who was appointed CEO of infrastructure-as-a-service business in April, said 89 of the top 100 startups in India were already on AWS. Public cloud providers like Google and Microsoft Azure have been aggressively wooing startups with credits to use their platforms.
The infrastructure-as-a-service division of Amazon.com was started 10 years ago. It is now on track to being a $10 billion annual business this year and has an operating margin of over 24%.
On Tuesday, the company launched an AWS cloud region in Mumbai by opening data centres, allowing it to target Indian companies that are required to hold their data in the country. “In our conversations with our customers, it was clear that they wanted a region in the country either for reasons of lower latency or for data sovereignty. We think having a region in the country will significantly accelerate our growth,” Jassy said.
An AWS region can have multiple data centres, or what the company calls availability zones. The Mumbai data centres will likely boost the amount of work AWS can do with banking and the healthcare sectors. Jassy said the company would also look to work with the government on its ‘Digital India’ initiatives. In addition to startups, the company counts large corporates such as Tata Motors and Axis Bank among those that use its cloud platform. In total, 75,000 out of AWS’ 1million active customers are in India, Jassy added.
AWS, which is the dominant player in the public cloud market, is just the latest company to set up data centres in the country. Microsoft has already set up data centres that will be used by its Azure public cloud market, so has IBM for its Softlayer public cloud offering. Google does not yet have data centres in the country.
“The opening of AWS’ data centre will make it harder for Microsoft and IBM. They already had a good base and even some financial services clients without a data centre here, they will become more competitive,” a technology analyst present at the Mumbai launch event told ET.
After AWS announced the launch, Microsoft issued a press release saying it was “accelerating the adoption of public cloud in India” with the three data centres that it opened last year. Since its inception, AWS has also drastically cut the cost of its own offering. The company has lowered prices 51 times in the last 10 years and often tells customers how they could cut their spending on its services.
“We have saved two million customers about $350 million that would have been spent on AWS. Which technology company do you know that would do that and hurt their revenue? I don’t think there are any,” Jassy said. AWS was an innovator rather than an acquirer, he said.
“Technology companies have lost their will to innovate. They tend to acquire new technologies by buying other companies. Amazon has always been pioneering and we are focused on the long term,” Jassy said. Sean Lee Womens JerseyShare This