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rumored to be entering the networking market

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It’s hard to remember a time when people thought Amazon was nuts for going into the cloud computing business, since it was so far removed from the company’s core ecommerce business. No one is laughing now.

It seems history could repeat itself. According to an article in The Information, Amazon is rumored to be targeting a new industry, albeit one dominated by a giant player and multiple healthy competitors — the Network Switches business. The move would put it in direct competition with Cisco, HPE, Juniper Networks, and Arista.

"As it does in many other categories, Amazon plans to use price to undercut rivals," the report said. "The company could price its white-box switches between 70 percent and 80 percent less than comparable switches from Cisco, one of the people with knowledge of the program estimated."
Now, Cisco products aren’t cheap, but how do you undercut it by 70 to 80 percent and not bleed money, even if it’s a loss leader for cloud services?

Patrick Moorhead, founder and principal analyst at Moor Insights & Strategy, said the move is logical. “Makes sense particularly as most switches use the same Broadcom chipset and can run the same software. TORs are close to commodity,” he tweeted.

The switches would specialize in connecting private data centers and Amazon Web Services (AWS). They'd use unbranded hardware and open-source software, with specialized connections to AWS cloud services. And it’s not like AWS would be starting from scratch or working with the bottom of the barrel. The Information noted AWS uses these same switches inside its own data centers, and AWS’s proposed partners are Celestica, Edgecore Networks, and Delta Networks.

Those are established players that have a healthy corner of the market. More important, Celestica and Delta are American companies, while Edgecore is in Taiwan. Given the concern over networking and server equipment from Chinese vendors, that could go a ways to allay hesitant buyers.

AWS, Microsoft, Google, IBM, and most cloud providers use unbranded white boxes from the U.S. and China in their data centers in preference to the more expensive and general use servers from HPE and Dell. These white box servers tend to have some features removed, such as unnecessary ports, with an emphasis in high throughput.Such use has made the white box server market a rousing success, when their sales are taken collectively. HPE and Dell are still tops as individual vendors. Still, with Amazon, Microsoft, Facebook, and Google building data centers the size of football stadiums, it’s done wonders for these guys.

The real Achilles' heel for AWS, though, isn’t running up against Cisco; it’s support. As The Information notes, networking is among the most complex challenges for companies that want to couple their private clouds with public clouds such as AWS. If Amazon’s devices are an attempt to simplify the connection of the hybrid cloud, I have one question: Who’s going to support it?

AWS has partners, but the company falls short of Microsoft’s MVPs and IBM’s Global Services consultancies. I’ve read more than once that with AWS, you are often on your own as compared to Microsoft Azure. AWS will need to significantly up its consultancy game if it wants to make these devices easy on-ramps to its services because the last thing any enterprise wants is for an Amazon delivery truck to drop a bunch of boxes at their lobby and say, "See ya!" AWS will have to bring people in to do the installation and setup.

Still, the report says Amazon is 18 months away from launching, which gives it plenty of time to address all of those issues.

asked Nov 9, 2018 in holidays by venynx (4,420 points)  

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