Amazon Not Building Out AWS To Compete With CDNs

Over the past few months, there has been a lot of speculation on what Amazon might be working on in regards to their EC2 and S3 service and whether or not their AWS offering is going to compete with content delivery networks. Adding to the confusion was the fact that Jeff Bezos made a brief announcement of a new upcoming streaming service but was scant on details.

Today, Amazon’s new video on demand content offering went into beta. The new offering is not a streaming service that has anything to do with AWS and is simply a new content offering that enhances the functionality of Amazon’s legacy Unbox service. The Amazon Web Services group is not supporting the new streaming content offering and the content is being delivered by Limelight Networks.

That being said, Amazon’s EC2 and S3 service continues to be a good option for developers who want to deliver their own video and provides a cheap and flexible way to do so. The Amazon service is not going after the same size customers the CDNs are and does not provide many of the elements a CDN does. Amazon is not going to be taking any major business away from the CDNs for numerous reason.

Amazon’s EC2 service is located in the U.S. and S3 is only located in the U.S. and Europe. There is no global coverage with either service although in an interview I did this week with Adam Selipsky, VP, Product Management and Developer Relations for Amazon Web Services, he did say that down the road they will expand into the Asia Pacific market with coverage. Many customers who use CDNs due so in order to take advantage of the global delivery. The average CDN customer is also not a developer, which is exactly who Amazon’s customers are. In order to use the EC2 and S3 service, you have to be a customer who wants to be very hands on, do a lot of the work yourself and in the case of streaming, license the server software from Adobe or Microsoft. Amazon does not provide any video specific reporting tools for raw logs and AWS customers have to deal with parsing raw logs through a third party system, specific for video.

The Amazon service also does not work well for live streaming as EC2 and S3 are not setup for edge delivery and was designed for storing objects, something that does not take place when the stream is live. There are also no additional content services in the ecosystem that many customers need like transcoding, authentication or stream protection. The bottom line is that right now, the EC2 and S3 products are for a very different set of customers than the CDNs are targeting. If you are a developer that needs U.S. based delivery, Amazon could be a really good fit and they publish their pricing on their website, something no major CDN does.

What I think Amazon should do is license the Adobe Flash Media Server directly from Adobe and then rent it out on an hourly basis like Amazon already does with other third party platforms. This would enable more developers who need the FMS server to look at Amazon as an option, instead of having to go and buy their own license from Adobe.

While Amazon’s AWS service is not a fit for most of those who use a CDN today, it is interesting to see how some of the CDNs are using Amazon’s service to their advantage. Digital Fountain is building their streaming only, U.S. based CDN on Amazon Web Services and other CDNs like have direct integration with Amazon’s S3 API.

Note: Werner Vogels, Amazon’s CTO, will be one of our keynote speakers at the Streaming Media West show in September in San Jose. Registration is open and all keynotes are free. Register now for your pass to see Werner talk more about Amazon’s Web Services.