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Amazon Touts Another Strong Quarter for Cloud Biz in Earnings Report

Despite a poor showing for Amazon.com as a whole, Amazon Web Services (AWS) Inc. maintained strong growth over its fiscal third quarter.

Amazon.com on Thursday reported a total of $20.58 billion in revenue for the quarter, a 20 percent year-over-year increase. However, the company missed Wall Street's estimate of $20.84 billion. Shares fell by $0.95, exceeding analyst expectations of a $0.74 decline. The company reported a net loss of $437 million for Q3.

However, sales for the "Other" category, which mostly comprises the AWS business, grew by 40 percent year-over-year, totaling $1.34 billion. As it did in Q2, AWS usage in Q3 grew by about 90 percent year-over-year.

Amazon.com touted this week's launch of the AWS Directory Service as one of the unit's milestones so far this year. More than 350 new features and services have been added to AWS this year, the company said.

New Frankfurt Datacenter
Amazon.com announced another cloud milestone on Thursday: the opening of a new AWS datacenter in Frankfurt, Germany.

The Frankfurt datacenter is the second AWS datacenter in the European Union -- the other being in Ireland -- and brings the total number of AWS regions worldwide to 11. It supports most AWS services, according to a blog post by AWS evangelist Jeff Barr.

"The new Frankfurt Region supports Amazon Elastic Compute Cloud (EC2) and related services, including Amazon Elastic Block Store (EBS), Amazon Virtual Private Cloud, Auto Scaling and Elastic Load Balancing," Barr wrote. "It also supports AWS Elastic Beanstalk, AWS CloudFormation, Amazon CloudFront, Amazon CloudSearch, AWS CloudTrail, Amazon CloudWatch, AWS Direct Connect, Amazon DynamoDB, Amazon Elastic MapReduce, AWS Storage Gateway, Amazon Glacier, AWS CloudHSM, AWS Identity and Access Management (IAM), Amazon Kinesis, AWS OpsWorks, Amazon Route 53, Amazon Relational Database Service (RDS), Amazon Redshift, Amazon Simple Storage Service (S3), Amazon Simple Notification Service (SNS), Amazon Simple Queue Service (SQS), and Amazon Simple Workflow Service (SWF)."

Besides improving latency and fault tolerance for users of the Ireland datacenter, the Frankfurt datacenter gives European customers another option to store their data in the cloud while still keeping it within EU. This has become especially important in the post-PRISM climate, in which cloud providers face greater scrutiny than ever over issues like privacy and data protection.

In an interview with Bloomberg, AWS Senior Vice President Andy Jassy said that German users are especially leery about storing cloud data offshore.

"What we found with our German customers, maybe more so than other places in the world, is they have a lot of passion for the data to reside in-country," Bloomberg quoted Jassy as saying.

The Frankfurt datacenter complies with "all applicable EU Data Protection laws," Barr stressed.

About the Author

Gladys Rama is the senior site producer for Redmondmag.com, RCPmag.com and MCPmag.com.

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