AWS has been steadily expanding beyond its traditional IaaS-PaaS capabilities into business applications and it seems to be ready to take those efforts to the next level. A few days ago, there were some reports that indicated that AWS has been working on a new line of services for traditional information worker tasks such as word processing, presentations or spreadsheets. The initiative is a clear indication of AWS’ intentions to compete with cloud rivals such as Microsoft and Google for the supremacy in the cloud productivity tools space.
AWS’s new line of services are far from being the only effort of the cloud gain in the business apps space. Last week, AWS announced Chime, a video-collaboration tool that rivals offers such as Skype for Business or Google Hangouts. WorkMail is another business centric service included in the AWS cloud.
Whether AWS’ move was anticipated or not it still results fascinating. Here we have a company with over 60% domination in the cloud platform market expanding into a complementarily market vastly dominated by its two closes competitors in the cloud space. It doesn’t get any better than that. The move can be compared with Facebook’s audacious entrance in the messaging space or Google release of Home to compete with Amazon Alexa.
What could be triggering AWS’s decisions to go into productivity tools? How feasible are those plans? Here is part of my initial analysis:
1 — Preventive Measures
Office365 and G-Suite are two of the biggest assets that Microsoft and Google can use to disrupt AWS’ domination in the cloud platform space. Both platforms are indirect channels for the commercialization of Azure and Google Cloud and AWS, obviously, intends to build that market.
2 — Building New Distribution Channels
Building on the previous point, Office365 and G-Suite count with millions of business as customers which provides an easier transition point to Azure or the Google Cloud platform. That channel is particularly important in large enterprise environments.
3 — Becoming Competitive via M&A
One aspect to consider is AWS’s capability to grow its productivity apps portfolio via acquisitions. At the end, a large percentage of the popular cloud business apps in the market are built on AWS. That position contrasts with Office365 and G-Suite’s grow that has been mostly based on in-house IP.
4 — The Battle of Emerging Markets
It is safe to assume that Office365 and G-Suite are going to remain the dominant cloud productivity suites in first-world markets such as North America, Europe or Australia. However, AWS is rapidly trying to consolidate its leadership position in emerging markets such as China, India, Middle East or Brazil in which a new business apps suite can be a great asset.
5 — Non-Developers Tools
Microsoft and Google have done a remarkable job expanding the capabilities of Office365 and G-Suite to non-developers. Tools such as Office365’s Flow or PowerApps are great examples of this trend. Until now, AWS have remained exclusively an infrastructure and developer-centric platform but the new productivity apps and service can set the foundation for non-developer tools and solutions.