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January 26, 2016updated 31 Aug 2016 9:37am

Is the cloud price war paying off for AWS?

News: Creation of AWS Certificate Manager that offers SSL and TLS certificates for free highlights how the company is innovating to stay ahead.

By James Nunns

Late on Thursday January 28th Amazon is set to publish its financial results and plenty of attention will be given to how the cloud unit Amazon Web Services is doing.

In what will be just the third time that the company has reported finances for its cloud unit separately within its full quarterly results, so this time customers, partners, the markets and rivals will be able to see a pattern of how well it is doing.

In the third quarter AWS delivered revenue of $2.08 billion, up 78% from a year ago as it produced an operating profit of $521 million while In Q2 revenue was at $1.8bn, next up will be the full year financials and a chance to see whether this growth is sustainable.

AWS is faced with stiff competition from Microsoft Azure and Google and an on-going cloud price war has underlined a battle for supremacy in the market that Gartner says will be worth $204bn in 2016, growing at a rate of 16.5%.

Microsoft has vowed to match AWS on price while Google says that it is the cheaper option regardless of price drops by competitors. AWS for its part lowered its prices for the 51st time earlier this month, quickly followed by Azure.

The price war is just one element of the on-going struggle between the three companies as a constant need to innovate new products and services forms a major part of how the companies are looking to lure businesses and developers to their cloud services.

AWS for example has just created a service called AWS Certificate Manager that will offer free SSL/TLS certificates for AWS resources.

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The Secure Socket Layer and Transport Security Layer certificates are designed to enable encrypted communication over a network.
Although offering this is nothing new, with companies such as Symantec already doing this, the big play is that it is free.

The certificates can potentially cost hundreds of dollars and so this cost saving could act as a major lure to developers that spend lots of money obtaining and renewing certificates.

Amazon will manage the whole process of obtaining and renewing certificates so developers no longer have to go through the process.

The company has said that it will only provide domain validated certificates with extended validated certificates unavailable.

This means that sites with sensitive personal data should stick with their current certificate providers.

Ultimately it means that a developer is being given another reason to either stay with or join AWS to run their applications and this capability is something that neither of the two competitors currently offers.

In the past year over 570 new services and products have been added to the company’s platform, this is something that the company is understandably proud of and it’s something that would be difficult for any rival to keep up with.

Microsoft has been busy trying to match AWS for services and price and has recently said that it offers stronger hybrid cloud capabilities than AWS.

Google meanwhile has made efforts to improve its image as a cloud provider for the enterprise. The appointment of VMware cofounder Diane Greene as the head of its cloud computing business should add some weight to the company’s enterprise push.

With Microsoft reporting its financial results on the same day as AWS, stakeholders will soon be able to compare how the services are stacking up against each other.

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