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© 2016, Amazon Web Services, Inc. or its Affiliates. All rights reserved.
Yinal Ozkan – Global Technology Lead – Financial Services
April 12, 2016
Creating Alternatives for Our CustomersAddressing Vendor Lock-in, Exit Strategy and Building a
Manageable Multi-Cloud Strategy
What Our Customers Tell Us
Our customers tell us that they want the flexibility to build their applications per their own specifications. They don’t want to be locked into a particular programming model, language, or operating system.
Why?
Painful years with old guard software and hardware companies has taught our customers that they have to be flexible in their information technology decision making. Our customers do not want to be locked into a single provider and face:• Continuous surge in costs• Lower quality in services• Less than optimal solutions• Behind innovation curve classification
Customers’ View
• Lessons learned from decades of pain with existing toolset – never again
• If there is an open source solution, why aren’t we using it and why are we paying for it?
• We want our solutions to be portable• FUD still exists, and the fear grows• Loss of control feels not right
Types of Questions
1. Long-term contracts, cost and pricing
2. Proprietary technology with no alternatives
3. Cost of migration
About Cost and Pricing
Customer Goals on Cost Control
• No long-term contracts• No expensive maintenance contracts• Choose common technologies to access talent faster and easier (reduce people costs)
• Pay-as-you-go consumption based pricing
• Flexible licensing
AWS Pricing Philosophy
High volume / low margin businesses are in our core DNA
Trade CapEXfor variable expense
Our economies of scale provide us with lower
costs
51 price reductions since 2006
Pricing model choice to
support variable and stable workloads
On-demand
Reserved Instances
Spot
Save more money as you grow bigger
Tiered pricing
Volume discounts
Custom pricing
AWS Pricing
Pay-As-You-GoAWS requires no minimum commitments or long-term contracts. With AWS, you replace your upfront capital expense with low variable costs and pay only for what you use. In essence, you convert your capital expense into variable expense.
Pay Less/Unit by Using MoreWith AWS you save more as you grow bigger. For services such as storage and data transfer, pricing is tiered. The more you use, the less you pay per gigabyte. For compute, you get volume discounts up to 10% when you reserve more.
Pay Less When You ReserveFor certain services, you can invest in reserved capacity. In that case, you pay a low upfront fee and get a significantly discounted hourly rate, which results in overall savings up to 60% over equivalent on-demand capacity.
Cost Control and AWS
• Variable spending models• Maintenance?• AWS allows access to talent • Consumption-based pricing• Flexible licensing
Proprietary Technology
TECHNICAL & BUSINESS SUPPORT
Account Management
Support
Professional Services
Solutions Architects
Training & Certification
Security & Pricing Reports
Partner Ecosystem
AWSMARKETPLACE
Backup
Big Data& HPC
Business Apps
Databases
Development
IndustrySolutions
Security
MANAGEMENTTOOLS
Queuing
Notifications
Search
Orchestration
ENTERPRISEAPPS
VirtualDesktops
StorageGateway
Sharing &Collaboration
Email &Calendaring
Directories
HYBRID CLOUDMANAGEMENT
Backups
Deployment
DirectConnect
IdentityFederation
IntegratedManagement
SECURITY &MANAGEMENT
Virtual PrivateNetworks
Identity &Access
EncryptionKeys
Configuration Monitoring Dedicated
INFRASTRUCTURESERVICES
Regions AvailabilityZones Compute
StorageO b j e c t s , B l o c k s , F i l e s
DatabasesSQL, NoSQL, Caching
CDNNetworking
PLATFORMSERVICES
APP
Mobile & WebFront-end
Functions
Identity
Data Store
Real-time
DEVELOPMENT
Containers
SourceCode
BuildTools
Deployment
DevOps
MOBILE
Sync
Identity
PushNotifications
MobileAnalytics
MobileBackend
ANALYTICS
DataWarehousing
Hadoop
Streaming
DataPipelines
MachineLearning
61 82
159
280
516
2010 2011 2012 2013 2014* As of 8 Oct 2015
More Tools for Integration
Customers’ View
• Third-party technology requires a lock-in• In-house technology does not require lock-in even if it is proprietary
• Infrastructure services look like software• IaaS is an advanced form of data centers• Open source technology is ready to use• Open source does not have stickiness because it is free and maintained by multiple parties
Open Source and AWS“We view open source as a companion to AWS' business model"— Chris Schlaeger, Director, Software Development, EC2
• AWS is a great platform to run open source solutions
• AWS services are ready to use• AWS services are maintained and supported by AWS
• AWS provides multiple options
Democratizing Technology Stack
• Today there are more alternatives than ever before• There is an investment and reliance on every technology stack used
• The main stickiness is not the technology itself;; cost of migration and education are the primary costs
• There must be a plan B• Definition of portability must be defined by the business since it has major cost and functionality implications
Irreversibility, Plan B, or Exit Plan
• Our customers always manage risk and they ask for an exit plan before they adopt AWS
• We help our customers to build, test, and run their applications on alternative platforms
• There is an alternative for each service• Exit plans include ownership and migration of data;; mass scale data migration services are critical
• Migration timelines, SLAs, and test plans should match other enterprise technology and service migration timelines
Cost of Migration, Designing for Portability
Customers’ View on Portability
• Solutions must be decoupled from infrastructure provider• Solutions should leverage the economies and the functionality of the next generation of cloud services providers
• Solutions should also work on my current data centers• We need a multi-cloud strategy• We need an abstraction layer to manage everything
Portability and AWS
“In economics, vendor lock-in, also known as proprietary lock-in or customer lock-in, makes a customer dependent on a vendor for products and services, unable to use another vendor without substantial switching costs.”
Wikipedia
• It is easier to move applications when they are decoupled from hardware
• It is easier to move applications when migration costs are kept at a minimum
• It is easier to leverage multiple platforms when they are developed based on distributed services or microservicesarchitecture (cont.)
Portability and AWS (cont.)
We acknowledge that portability costs exist with
any technology.
The major cost to “migrate off” a platform or technology is around labor and people
(even with “Open” tech).
Perceived “lock-in” in regards to cloud is
different.
In the cloud, there are no long-term licensing agreements, no maintenance contracts, no infrastructure investments, or
sunk costs.
The choices customers have in the cloud allow easy
portability.
“For each of my IT functions, I’m going to make a decision how much it would cost and how much I’m willing to spend to avoid that.”
1 2 3
(related labor costs)
(cont.)
1 2 3
AWS has one of the most extensive training and certification programs, including online and in-person classes, hands on labs, and certifications.
AWS has thousands of developers certified – this is many times more than other cloud vendors and your developers don’t
need to be retrained on a whole new model.
AWS publishes new white papers, templates, “how to” guides and
more on a regular basis.
Portability and AWS (cont.)
Amazon Web Services
Your Applications
ApplicationLogic
Interface &Experience
CustomerValue
ApplicationSecurity
BusinessInsight
INFRASTRUCTURESECURITY
PLATFORMSERVICES
SUPPORT
MAR
KTET
PLAC
E
MAN
AGEM
ENT
TOO
LS
ENTE
RPRI
SE A
PPS
HYBR
ID C
LOUD
Choosing a cloud provider is not like choosing a server.
It’s like choosing a major service provider.
You want the best capabilities for the application you intend
to deliver.
Solutions on AWS are Portable
Amazon Web Services
Your Applications
ApplicationLogic
Interface &Experience
CustomerValue
ApplicationSecurity
BusinessInsight
INFRASTRUCTURESECURITY
PLATFORMSERVICES
SUPPORT
MAR
KTET
PLAC
E
MAN
AGEM
ENT
TOO
LS
ENTE
RPRI
SE A
PPS
HYBR
ID C
LOUD
Operations, Runtime, Application Framework
Cloud Abstraction Layer
“IT organizations cannot treat cloud IaaS providers like
commodities.”Lydia Leong, VP Distinguished
Analyst
Expedite Portability with Abstraction Layer?
Abstraction layers don’t eliminate the risk of lock-in, they simply shift it to another vendor or solution and
they also bring in a major maintenance problem
Infrastructure Services
Security
Platform Services
Marketplace
Support Hybrid
Enterprise
Mgmt. Tools
Cloud Abstraction LayerOperations, Runtime, Application Framework
Applications
Abstraction Layers and New Layer of Lock-in
By signing up for multi-cloud vendor strategy, you are settling for the Lowest Common Denominator feature set
Encryption options for Object Storage
AWS Other Other Other OtherServer-Side Encryption (SSE) ü X ü X ü
SSE using customer managed keys ü X X X XSSE using a Key ManagementService (KMS) hosted by provider ü X X X X
Client-side Encryption ü ü X X XHardware Security Module (HSM) ü X X X X
How does the Lowest Common Denominator Look Like?
What About a Multi-cloud Vendor Strategy?
• Multi-vendor strategies are not new and they are a standard component of risk management controls
• Million dollar question is the cost• Multi-cloud makes sense if you have 2+ vendors for each service and technology you are consuming today
• Does multi-cloud mean live failover for your operations• All clouds are not created equal so the most common denominator problem still applies
and be wary of the single point of failure…
Data Gravity
• There are great AWS provided technology solutions for moving data in and out of AWS
• AWS allows bi-directional migration of gold images• Data movement is one of the most promising 3rd party ISV solution domains
• There are major examples of large scale migrations to and from AWS