Structure News: Making the case for an independent Amazon Web Services

Your weekly tech news roundup, with a little bit of Structure. Where The Future Was Never Going To Be Vined October 28th, 2016 / by Tom Krazit This week, we'll talk about whether or not Amazon Web Services should fly on its own instead of propping up a bookseller, how GE Transportation is using fog computing to make sure the trains run on time, and why you shouldn't necessarily panic about the insecurity of the internet of things. BIG PICTURE At what point does Amazon Web Services deserve to operate without that big old ecommerce giant dragging it down? Amazon has long played down talk of spinning off AWS, which would definitely be a complicated process and potential distraction for employees as the overall cloud market continues to grow. But maybe CEO Andy Jassy should be thinking about how his organization would be perceived as a standalone entity: a fast-growing, profitable group defining the future of enterprise computing. Earnings report cards were due again this week, and it was the tale of two Amazons: the ecommerce operation's profits plunged, dragging the company's stock down along with it. But revenue and operating profits soared at AWS, with revenue up 55 percent to $3.2 billion while operating income doubled to $861 million. It's never entirely clear how profitable AWS is because some of its costs are spread across Amazon in general, but Amazon's total operating income was only $575 million, meaning that AWS is subsidizing the rest of the company to some extent. At some point, could the remaining part of Amazon actually hurt the growth of AWS? That point is not on the near horizon, but Amazon shareholders would stand to gain quite a bit from the successful spin-off of an already huge and fast-growing enterprise computing company; when does the temptation become too much? An independent AWS would also force cloud computing to be much more transparent about its finances, as Om Malik called for earlier this year (a notion that has Structure's full support). Amazon can hide a lot of details about AWS in its overall earnings report, which is one of the reasons why it prefers things the way they are now. But if cloud is really going to become the engine for the rest of the 21st century, investors and customers need to know more about the finances behind this historic shift. I'm not holding my breath. But I do see a day in which it finally makes too much sense, and AWS and Amazon go their separate ways. STRUCTURE NEWS HOW GENERAL ELECTRIC IS UPGRADING THE RAILROAD INDUSTRY Seth Bodnar of GE Transportation (and Structure 2016 speaker) has a very interesting job; bringing the world of railroads into the 21st century with edge computing techniques. I wrote about some of the work they're doing in Fortune, and those products are helping railways operate faster and safer thanks to real-time data and increased computing power on locomotives themselves. Seth (pictured) is just one of the amazing speakers we have lined up for Structure 2016, scheduled for November 8th and 9th at San Francisco's UCSF Mission Bay conference center. Tickets are still available for one of the best annual events in cloud computing; you can register here, and you can check out the rest of the speakers here. INDUSTRY NEWS MICROSOFT TO RAISE PRICES UP TO 22PC AFTER SLUMP IN THE POUND Brexit is getting real pretty quickly, even though the U.K. government has yet to formally start the process of withdrawing from the E.U. In response to a drop in the value of the pound, Microsoft plans to raise cloud computing prices by 22 percent in the U.K., according to the Telegraph. THE INTERNET OF THINGS ISN'T TRYING TO KILL YOU It's been a troubling few weeks for backers of the internet of things, after several attackers managed to hijack devices and bring down hundreds of websites around the world. However, as Official Friend of Structure and SKT Labs founder Stacey Higginbotham explains in this post on Medium, some perspective is required before lumping all IoT companies in the same boat as the camera manufacturer who shipped millions of devices with hardcoded default passwords. FORMER CISCO EXECS TALK TO MICROSOFT ABOUT A STARTUP Cisco's MLPS team helped the networking company modernize its product line over the last few years, but they were sidelined by a change at the top. Now The Information (subscription required) reports that the four engineers are talking to Microsoft -- which they are already working with on improving Azure's networking -- about a simillar arrangement. We'll try to tease some details out of Microsoft cloud boss Scott Guthrie at Structure. THE STATE OF ENTERPRISE MACHINE LEARNING Check out this great overview from The Next Platform examining how machine learning is changing the design and development of enterprise software. Perhaps most interesting are the specific examples of how Carolinas Health System, Cisco, and Paypal used machine-learning techniques to identify ways to save money on operations. AI PIONEER YOSHUA BENGIO IS LAUNCHING ELEMENT AI, A DEEP-LEARNING INCUBATOR We'll be sure to watch the startups that come out of Element AI, a new creation from University of Montreal professor and artificial intelligence legend Yoshua Bengio. Wired reports that Montreal is about to become an even bigger destination for AI talent, one of the most sought-after skills in 2016. CENTURYLINK IN ADVANCED TALKS TO MERGE WITH LEVEL3 COMMUNICATIONS In what would create a huge new internet service provider, CenturyLink and Level3 are apparently thinking about getting hitched. The Wall Street Journal reports that the deal would allow both companies to better compete against Comcast and AT&T for home and business customers. QUOTE OF THE WEEK Seattle is the cloud. That's the amazing thing about Seattle. There's no other city in the world that has the technical agenda Seattle has." Bob Kelly, Ignition Partners, as told to Geekwire Click here to unsubscribe from this list. Our mailing address is: 405 El Camino Real, #215 Menlo Park, CA 94025 Copyright (C) 2016 StructureSeries All rights reserved.