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Case Study Amazon’s New Store: Utility Computing
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Case Study Amazon’s New Store: Utility Computing
Introduction
Back in the year 1995, Amazon was opened as a bookstore, one that has grown over the years and morphed into a large reputable internet based company. One of the largest virtual superstores today in the world, Amazon offers up to thirty six categories of products. Jewelry, furniture, clothing and groceries are just but a few of the products that Amazon has to offer. Today, Amazon boasts of being the top online retailer in the whole world (Andrei and Jain, 2009). In an effort to modernize its data centers and software and also be able to add new features in the existing product pages, it developed a number of important services that have proved significant in its growth over the years.
Question 1
World over, Amazon is known for the provision of cloud computing also known as utility computing or demand computing. In essence, it refers to allowing the firm to offload peak demand for computing power to large scale data processing centers that are remote. In a nutshell, the Amazon Company offers computing capacity on a per usage basis. Amazon is at an advantageous point in terms of business in the sense that it can generate more income from a number of other businesses (Buyya, Yeo, Venugopal, Broberg and Brandic, 2009). This can be achieved through provision of its extra and additional capacity to those in need.
Amazon uses only a small percentage or portion of its computing capacity and any one time, a scenario that is synonymous with a number of establishments. Another key aspect at Amazon is the robust infrastructure that that is attributed to this company. S(3) also known as subscribers to the simple storage service are able to use what they need without the extra cost of having to buy their own software and hardware (Palankar, Iamnitchi, Ripeanu and Garfinkel, 2008). The entire cost of owning small and medium-sized businesses is greatly reduced.
It is very clear that this type of system is scalable and very dependable for both Amazon and its subscribers. Additionally, Elastic Compute Cloud (EC2) service also allows businesses to be able to utilize servers owned by Amazon for their various computing tasks minus the overhead costs. Amazon competitors like IBM and Sun Microsystems may have to keep on Amazons lead by offering utility computing without the infamous service level agreements (SLAs). The reason being the a number of businesses around the world are ready to promise availability of service in terms of time but are cautious when it comes to suppliers that do not offer SLAs. The Amazon web services pose as another challenge and risk to its web service route and retail line if it fails to place itself in a position that will be able to manage any increase in demand for its infrastructure (Linton, 2011). Another key disadvantage and shortcoming is that the customers may face a number of outages in the service and still fail to get compensations due to the fact that service level agreements do not exist.
A number of businesses are potential beneficiaries of the various services that Amazon as a company can provide. For instance, large and small businesses can benefit from the Amazon web services where the service manages to discharge small businesses from the total cost of ownership that might result from owning individual systems. Amazon web services also provide an opportunity for other businesses to be able to work at web scale without having to make mistakes that have already been done by Amazon. This means that they get to learn from its mistakes without necessarily having to go through them. Finally, another great importance for use of Amazon’s utility computing by other businesses would be that they can use the Amazon web services as an ancillary unit without the need to increase or improve their total cost of ownership or their hardware.
Question 2
Amazon has the responsibility of ensuring that it provides hardware capacity and planning and scalability for itself and its subscribers. This means that no excuses can be made or underestimations be created when it comes to capacity and scalability. The reason behind it being that, they risk running into drastic shortages for their own business, as well as, their subscribers. On the other hand making, overestimates would mean that they Amazon’s financial assets might be affected (Kim, 2009). Frequent instances of non-availability would result in the creation of the impressions that Amazon is finding it hard to manage their services. Amazon has to ensure that it manages to sustain the total cost of ownership of its services at the same time ensuring it manages to generate revenue from it.
Question 3
A number of companies offer and supply utility computing, however, the best examples would be Hewlett-Packard (HP) and Sun Microsystems. Hewlett-Packard offers utility computing for mail, messaging, print, centralized data center infrastructure by the means of its distributed grid technology and server storage (House and Price, 2009). Its key focuses are the small, medium and large sized companies around the world. They provide these computing services with 99.9 percent availability. Sun Microsystems also offers the service of utility computing through the grid computing system. Their charges tend to be retained at the one dollar per CPU hour mark.
Sun Microsystems provides a platform that targets specific consumers with examples being in the field of financial services, life sciences, computational mathematics, and computer-aided engineering just to mention but a few (Hall, 1990). Various software developers often use the Sun’s Network.com service for testing and building applications for its various customers. Sun Microsystems promises and offers 99.9 percent availability. In comparison to Amazon, one realizes that it offers an easier service in the sense that it tends to accommodate and incorporate into start-up businesses. It is specifically designed and focused towards the small and medium sized businesses (Zhang, Chen, Zhang and Huo, 2010).
Question 4
Amazon has a very flexible and pay-as-you-go model presents a great opportunity for any individual with the idea of starting up a web-based business (Linton, 2011). The reason is that; it provides and adds a competitive advantage over companies that need service contract or the need for a business to buy its own storage. The S3 and EC2 services would come in handy in the sense that it provides an inexpensive and fast method for startups to store data on the system. Affordability and the sense of inexpensiveness are brought about by the fact that users pay only for exactly what they use.

References
Andrei, T., & Jain, R. (2009). Cloud computing challenges and related security issues. A Survey Paper. DOI= http://www. cse. wustl. edu/~ jain/cse571-09/ftp/cloud. pdf.
Buyya, R., Yeo, C. S., Venugopal, S., Broberg, J., & Brandic, I. (2009). Cloud computing and emerging IT platforms: Vision, hype, and reality for delivering computing as the 5th utility. Future Generation computer systems, 25(6), 599-616.
Hall, M. (1990). Sunburst: The ascent of Sun Microsystems. Chicago: Contemporary Books.
House, C. H., & Price, R. L. (2009). The HP Phenomenon: Innovation and Business Transformation. Palo Alto: Stanford University Press.
Kim, W. (2009). Cloud Computing: Today and Tomorrow. Journal of object technology, 8(1), 65-72.
Linton, R. (2011). Amazon Web Services: Migrating your .NET Enterprise application : evaluate your Cloud requirements and successfully migrate your .NET Enterprise application to the Amazon Web Services platform. Olton, Birmingham, U.K: Packt Pub.
Palankar, M. R., Iamnitchi, A., Ripeanu, M., & Garfinkel, S. (2008, June). Amazon S3 for science grids: a viable solution?. In Proceedings of the 2008 international workshop on Data-aware distributed computing (pp. 55-64). ACM.
Zhang, S., Chen, X., Zhang, S., & Huo, X. (2010, October). The comparison between cloud computing and grid computing. In Computer Application and System Modeling (ICCASM), 2010 International Conference on (Vol. 11, pp. V11-72). IEEE.

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