Rumors that Amazon was entering the enterprise networking business sent shockwaves through the industry last week, but their decision to shy away from the new endeavor was likely in their best interest.
Earlier this summer, reports surfaced that Amazon, the Big Bad Wolf of public cloud computing, was looking to huff, puff and blow the houses of legacy enterprise network providers down. Though they amounted to little more than empty bluster (the web giant officially denied that it would make such an endeavor), the reports alone were enough to send the stock prices of networking giants Cisco and Juniper plummeting.
An enterprise networking solution seemed like the perfect partner for Amazon’s massive Amazon Web Services (AWS) cloud platform, and given its tremendous size, a push into this market might have seemed like a safe choice.
But the truth is that their decision to back away from enterprise networking was likely in Amazon’s best interest. The specific challenges and demands of the enterprise networking market make it an especially difficult world to break into, especially for companies as diversified as Amazon.
Amazon’s leap into enterprise networking looked relatively simple. As a massive company that uses its own open-source software in-house, Amazon likely would have loaded additional open-source software on commodity boxes from Celestica, Edgecore, and others. Because of its massive scale, it could have potentially offered those white-box solutions at only 70% or 80% of the price of legacy network providers. And it could offer software connected to its own AWS cloud services, giving Amazon greater control over the data centers using its cloud services and creating a powerful incentive for enterprise customers.
It’s easy to understand why Amazon would have been interested in the enterprise networking market, given that enterprise networking in the US is worth almost $9 billion and may top $10 billion in the next six years, according to Statista.
However, those numbers provide an incomplete picture of the market: the growth doesn’t lie in the switches and routers.
As cybercriminals become increasingly advanced and more enterprises store their data digitally, the main driver of enterprise network market growth moving forward will be an increasing need for cybersecurity staff. A low-cost platform isn’t the only necessary component to succeed in enterprise networking. Rather, ongoing service and support from experts with decades of industry experience is required to keep up with near-constant security threats and developing technology.
While Amazon has plenty of cybersecurity and IT professionals on staff, securing an internal network is an entirely different ball game than providing continual maintenance to untold numbers of clients. For Amazon to make headway in the enterprise networking market, they would have to prove that they have the time and resources to give their new clients the support that they need — a difficult endeavor for such a diversified company.
Amazon ultimately realized that massive scale and underpriced hardware aren’t enough to become a trusted partner in enterprise networking. Enterprise networking means long-term, trusted partnerships, which is exactly why the industry experts at Turn-key Technologies (TTI) provide managed IT services on-demand. An effective networking partner puts its clients first — that’s what TTI can do for you.