Amazon Web Services worth $650m in 2010

Investment bank Citigroup has estimated that Amazon Web Services (AWS) will earn the web giant $650 million during 2010, according to a report in BusinessWeek.

This estimate helps to gauge the true worth of the pioneering cloud computing offering, which Amazon itself does not reveal in its financial reports. If true, the figure suggests that Amazon by far outstrips its competitors in the so-called “infrastructure-as-a-service” market.

Hosting provider Rackspace, for example, earned $56 million from its cloud business – which includes hosted email and SharePoint as well as cloud-based servers – during 2009, although it expects that figure to grow significantly in 2010. Savvis, meanwhile, earned just $7.4 million from cloud services in 2009.

In the related field of “platform-as-a-service”, which allows developers to build applications from composite web services, rather than raw computing resources, market leader does not break out its revenues from its core CRM application. Microsoft, whose Azure cloud platform is available in the US, does not reveal how much money it generates.

By way of comparison, Citigroup’s estimate places Amazon Web Services as roughly equivalent in revenue to Rackspace in its entirety, Patni Computer Systems and Quest Software during 2009.

The online book retailer launched AWS in 2002. This week, the cloud computing services were launched in Asia Pacific for the first time.

Pete Swabey

Pete Swabey

Pete was Editor of Information Age and head of technology research for Vitesse Media plc from 2005 to 2013, before moving on to be Senior Editor and then Editorial Director at The Economist Intelligence...

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