My industry analyst takeaways from AWS Re: Invent – AWS is more than a cloud

AWS re: Invent is a weeklong event filled with lots of news, year after year. 2021 was no different as the company made several important announcements ranging from storage to networking to calculate. On the computational front, Moor Insights & Strategy Senior Analyst Patrick Moorhead provided an overview of the company’s Graviton 3, Trainium, Inferentia and Nitro SSD revelations. You can check this coverage here. Paul Smith-Goodson has weighed in on AI / ML and Will Townsend has covered all things networking and 5G.

So as not to be repetitive in my Patrick’s cover – let me give you a quick recap. Amazon is investing heavily in the design and development of silicon to support enterprise workloads natively. It’s worth reading his (Patrick’s) article to understand how much of a silicon design house Amazon is.

I’ll spend the next few paragraphs explaining why I think AWS innovations position the business inthe company and what it might mean for the industry. I will also delve deeper into the importance of this for the larger Arm server game.

First – what I heard – the Cliffs Notes version

As mentioned, Arm made several announcements related to the computation. As part of the company briefing, she focused her latest round of innovations in three categories: supporting every workload; build and evolve your global network; calculate where you need it.

Each of these categories merits further study. AWS has enhanced its service portfolio to enable enterprises to deliver workload-optimized compute platforms to customers wherever they are needed and connected through a secure, high-bandwidth network.

The announcements made about taking charge of each workload are exactly what you think. Instance offers that cover the computing landscape. General use, intensive in computation, memory and storage.

  • Want to use AWS for your machine learning (ML) needs? No problem – AWS claims the largest number of ML instances available in the world with five unique training instances and six unique inference instances. These instances are aided by the silicon designed by AWS – newly introduced Trainium for deep learning acceleration and Inferentia for inference acceleration.
  • What about the needs of EDA? The AWS X2ezn instance provides high frequency based on Intel Ice Lake (4.5 GHz) to meet the most demanding needs.
  • And general-purpose, compute-intensive workloads can benefit from the company’s new Arm-based Graviton3 chip. With Graviton3, the company claims 25% better value for money than Graviton2.

The company’s networking announcements focused on making endpoints faster, more secure, and easier to connect, with monitoring and management tools to make life easier for IT organizations.

AWS’s focus on “computing where you need it” is, to me, perhaps the most important area for the market to consider. This is where we stop talking about AWS as a cloud provider and start talking about AWS as an IT solutions provider, competing with Dell Technologies, HPE, Lenovo, Cisco and others.

Looking back, it’s easy to see how AWS now competes across the entire solution stack – from silicon to hardware to software. And not in a “dip his toes in the water” way. Instead, the company is proving to be able to deliver complete solution stacks to its customers – in the cloud, at the edge or in the main data center.

And while it may have been quite obvious to every reader, re: Invent 2021 shows how AWS is a player in the IT solutions value chain.

Second – consumer computing is the new normal

We have been talking for a very long time about the trivialization of calculation. But maybe in the wrong context. While software architectures, frameworks, and delivery methods have made the underlying architectures (e.g. Intel v AMD, x86 v Arm v POWER) less relevant, workload-specific performance needs have always determined processor architecture and affinity and preference. In fact, Patrick Moorhead wrote about how AWS differentiated itself on the compute front in its coverage of last year’s re: Invent.

The packaging and delivery of optimized solutions through AWS Outposts, Azure Stack, HPE GreenLake, etc. has started to generate real speed for consumption-based computing. Providing such services enables the economy and simplicity of the cloud, on-premises.

Talk to any IT admin supporting a somewhat modernized business – they don’t buy servers. They buy analyzes platforms. Or hybrid cloud environments. Or the AI solutions. That is, stacks of complete solutions, prepackaged and optimized for performance. And in many cases, installed, monitored, and managed by AWS, HPE, Dell, or an integrator using these platforms.

So the real question is – as consumer computing continues to take hold and develop – who wins? Ultimately, the customer. On the supplier side of the equation, the IT solutions provider who can deliver the best performance at the lowest cost will be in a strong position. And AWS should play a leading role because it can deliver solutions designed, developed and optimized entirely on AWS technology. From silicon to hardware to software. It’s quite convincing… and unique.

Third – I told you about Arm

I have been covering Arm since Neoverse’s first announcement – and have been “accused” of being overly optimistic about my ratings of Arm-based servers in the data center. I’m not in a position to say “I told you so”, but it looks like the Arm Neoverse ecosystem is starting up. AWS is on a 12-18 month cadence to deliver Graviton (Arm-based) platforms that span the price and performance continuum. Ampere is having great success in the cloud, including Oracle Cloud Infrastructure (which cannot deploy its Arm instances quickly enough to meet demand). Several cloud providers in China have created and extended Arm in their respective service catalogs.

On the high performance computing (HPC) and AI front, Arm has achieved similar success. Its architecture stands at the top of the TOP500 for supercomputers and is well represented throughout the list. Additionally, Arm-based servers have achieved performance parity with x86 in the high performance computing market.

One could easily argue that AWS paved the way for Arm’s success with its acquisition of Annapurna Labs and the release of Graviton. As the company continues to expand its Arm-based services, it integrates Arm into the physical data center through outposts. And as consumer-driven computing continues to take hold, expect Arm to gain market share as vendors will be able to pass on price-performance benefits as a way to stay competitive.

Finally, consider this. The AWS Annapurna team can use its Graviton offering and reverse the bits to optimize specific workloads, enabling features and instructions that promote a workload and disabling those that don’t. The performance goes up and the price goes down. That’s the beauty of Arm – an openness that enables agility.

Finally, what does this mean for the company?

Announcements made at AWS re: Invent 2021 reflect what AWS sees in enterprise computing. Businesses are in the throes of digitization efforts and they need a new set of workloads and analytics tools to drive this transformation. Workloads and tools unknown to IT on platforms that are too complex and too expensive.

The appetite of businesses to simply consume these offerings as a service, whether on-premise or in the cloud, is huge. Just look at the growth of HPE GreenLake, Dell APEX, or Lenovo TruScale. Or, for that matter, AWS Outposts. Preconfigured solutions deployed and maintained for IT. Solutions where I only pay for what I consume. Nirvana for business computing.

AWS continues to make the right decisions to be a significant player in the modern, digital industry. Graviton3, Trainium and Inferentia are examples of how the company is innovating in silicon. But in many ways, the importance of this silicon is less about the technology and more about how AWS owns the value chain.

It’s going to be a fun few years as we see how the IT solutions market evolves.

Note: The editors and editors of Moor Insights & Strategy may have contributed to this article.

Moor Insights & Strategy, like all research and technology industry analyst firms, provides or has provided paid services to technology companies. These services include research, analysis, advice, consultancy, benchmarking, matchmaking or conference sponsorship. The company has had or currently has paid business relationships with 8 × 8, A10 Networks, Advanced Micro Devices, Amazon, Ambient Scientific, Anuta Networks, Applied Micro, Apstra, Arm, Aruba Networks (now HPE), AT&T, AWS, A – 10 Strategies, Bitfusion, Blaize, Box, Broadcom, Calix, Cisco Systems, Clear Software, Cloudera, Clumio, Cognitive Systems, CompuCom, CyberArk, Dell, Dell EMC, Dell Technologies, Diablo Technologies, Dialogue Group, Digital Optics, Dreamium Labs , Echelon, Ericsson, Extreme Networks, Flex, Foxconn, Frame (now VMware), Fujitsu, Gen Z Consortium, Glue Networks, GlobalFoundries, Revolve (now Google), Google Cloud, Graphcore, Groq, Hiregenics, HP Inc., Hewlett Packard Enterprise, Honeywell, Huawei Technologies, IBM, IonVR, Inseego, Infosys, Infiot, Intel, Interdigital, Jabil Circuit, Konica Minolta, Lattice Semiconductor, Lenovo, Linux Foundation, Luminar, MapBox, Marvell Technology, Mavenir, Marseille Inc, Mayfair Equity, Meraki (Cisco), Mesophere, Microsoft, Mojo Netwo rks, National Instruments, NetApp, Nightwatch, NOKIA (Alcatel-Lucent), Nortek, Novumind, NVIDIA, Nutanix, Nuvia (now Qualcomm), ON Semiconductor, ONUG, OpenStack Foundation, Oracle, Panasas, Peraso, Pexip, Pixelworks, Plume Design, Poly (formerly Plantronics), Portworx, Pure Storage, Qualcomm, Rackspace, Rambus, Rayvolt E-Bikes, Red Hat, Residio, Samsung Electronics, SAP, SAS, Scale Computing, Schneider Electric, Silver Peak ( now Aruba-HPE), SONY Optical Storage, Springpath (now Cisco), Spirent, Splunk, Sprint (now T-Mobile), Stratus Technologies, Symantec, Synaptics, Synversec, Synopsys, Tanium, TE Connectivity, TensTorrent, Tobii Technology, T -Mobile, Twitter, Unity Technologies, UiPath, Verizon Communications, Vidyo, VMware, Wave Computing, Wellsmith, Xilinx, Zayo, Zebra, Zededa, Zoho and Zscaler. Moor Insights & Strategy Founder, CEO and Chief Analyst Patrick Moorhead is a personal investor in technology companies dMY Technology Group Inc. VI and Dreamium Labs.

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