Case StudyEnabling Team: Seeding Internal Products - AWS: From Cost Center to Profit Center
Like other companies, Amazon's IT infrastructure was viewed as a cost center, focusing primarily on supporting the company's retail operations. But Amazon realised that every other company was dealing with the same server hosting challenges.
The Solution
Amazon Web Services (AWS) was launched to monetize Amazon’s robust IT infrastructure by offering cloud services to external customers. This initiative leveraged Amazon’s expertise in scalable, reliable, and cost-effective infrastructure management. AWS provided a wide range of services, including computing power, storage, and databases, to businesses of all sizes.
Key Actions:
- Launched AWS to offer cloud computing services externally.
- Utilized existing infrastructure to minimize initial costs.
- Focused on scalability, reliability, and cost-effectiveness.
- Continuously expanded service offerings to meet diverse customer needs.
- Established a pay-as-you-go pricing model to attract a broad customer base.
Outcomes achieved
AWS quickly became a significant profit center for Amazon, contributing substantially to the company's overall revenue. The platform’s success was marked by its widespread adoption across various industries, from startups to large enterprises. AWS's scalable and flexible cloud solutions enabled businesses to reduce their own IT costs, driving further adoption and reinforcing AWS's profitability.
Benefits:
- Transformed IT infrastructure from a cost center to a profit center.
- Achieved substantial revenue growth, making AWS a key revenue stream for Amazon.
- Enabled customers to reduce their own IT expenses, fostering widespread adoption.
- Supported innovation and agility for businesses across multiple industries.
- Established AWS as a market leader in cloud computing services.
