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I’d like to see AWS split off from the rest of Amazon and I’m pretty sure I’m not alone. So to help that happen, I’ve drafted a PR/FAQ and posted it on GitHub so that it can be improved. People who know what a PR/FAQ is and why this might be helpful can hop on over and critique the doc. For the rest, herewith background and explanation on the what, why, and how.
A project needs a name and so does a company. For the purposes of this draft I’m using “A-Cloud” for both.
Why spin off AWS? · The beating of the antitrust drums is getting pretty loud across a widening swathe of political and economic conversations. The antitrust guns are particularly aimed at Big Tech. Whom I’m not convinced are the most egregious monopolists out there (consider beer, high-speed Internet, and eyeglasses) but they’re maybe the richest and touch more people’s lives more directly.
So Amazon might prefer to spin off AWS proactively, as opposed to under hostile pressure from Washington.
But that’s not the only reason to do it. The cover story in last week’s Economist, Can Amazon keep growing like a youthful startup? spilled plenty of ink on the prospects for an AWS future outside of Amazon. I’ll excerpt one paragraph:
AWS has the resources to defend its market-leading position. But in the cloud wars any handicap could cost it dearly. Its parent may be becoming one such drag. For years being part of Amazon was a huge advantage for AWS, says Heath Terry of Goldman Sachs, a bank. It needed cash from the rest of the group, as well as technology and data. But Mr Bezos’s habit of moving into new industries means that there are now ever more rivals leery of giving their data to it. Potential customers worry that buying services from AWS is tantamount to paying a land-grabber to invade your ranch. Walmart has told its tech suppliers to steer clear of AWS. Boards of firms in industries which Amazon may eye next have directed their it departments “to avoid the use of AWS where possible”, according to Gartner.
The Economist plausibly suggests a valuation of $500B for AWS. Anyhow, the spin-off feels like a complete no-brainer to me.
Now, everyone knows that at Amazon, when you want to drive a serious decision, someone needs to write, polish, and bring forward a six-pager, usually a PR/FAQ. So I started that process.
What’s a PR/FAQ? · It’s a document, six pages plus appendices, that is the most common tool used at Amazon to support making important decisions. There’s no need for me to explain why this is works so well; Brad Porter did a stellar job back in 2015. More recently, Robert Munro went into a little more detail.
On GitHub? · One thing neither of those write-ups really emphasize is that six-pagers in general, and PR/FAQs in particular, are collaborative documents. The ones that matter have input from many people and, by the time you get to the Big Read in the Big Room with the Big Boss, have had a whole lot of revisions. That’s why I put this one on GitHub.
I feel reasonably competent at this, because there are now several successful AWS services in production where I was an initial author or significant contributor to the PR/FAQ. But I know two things: First, there are lots of people out there who are more accomplished than me. A lot of them work at Amazon and have “Product Manager” in their title. Second, these docs get better with input from multiple smart people.
So if you feel qualified, think AWS should be spun out, and would like to improve the document, please fire away. The most obvious way would be with a pull request or new issue, but that requires a GitHub account, which probably has your name on it. If you don’t feel comfortable contributing in public to this project, you could make a burner GitHub account. Or if you really don’t want to, email me diffs or suggestions. But seriously, anyone who’s qualified to improve this should be able to wrangle a pull request or file an issue.
What’s needed? · Since only one human has read this so far, there are guaranteed to be infelicities and generally dumb shit. In particular, the FAQ is not nearly big enough; there need to be more really hard questions with really good answers.
Also, appendices are needed. The most important one would be “Appendix C”, mentioned in the draft but not yet drafted. It covers the projected financial effects of spinning out A-Cloud. I’d love it if someone financially savvy would wrap something around plausible numbers.
Other likely appendices would be a description of the A-Cloud financial transaction, and (especially) a go-to-market plan for the new corporation: How is this presented to the world in a way that makes sense and is compelling?
Document read? · Before these things end up in front of Andy Jassy, there are typically a few preparatory document reads where intermediate-level leaders and related parties get a chance to spend 20-30 minutes reading the document then chime in with comments.
Given enough requests, I’d be happy to organize such a thing and host it on (of course) Amazon Chime, which really isn’t bad. Say so if you think so.
Contributions
Comment feed for ongoing:
From: John Cowan (Jun 22 2020, at 20:59)
Two words: "interlocking directorates". You need a stronger separation of control to provide the necessary confidence. (Shared ownership isn't a problem: when Standard Oil was split into 34 companies in 1911, the stockholders got stock in the newly independent companies.)
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From: richard o. zerbe (Jul 24 2020, at 10:24)
You might be interested in an article by Robert Lande and myself, coming out this fall in American University Law Review. This suggests an stronger role for the Sherman Act in antitrust and our hope is that it will stir debate as you are doing also.
The breakup of Amazon into suggested divisions is consistent with what we say.
I am Richard Zerbe a retired UW prof. I will post our article by need to check with LR to see if it is okay (maybe on SSRN) or you can send a request to my email: richardozerbe@gmail.com
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