Today, Amazon ( s AMZN) Web Services announced a management console that illustrates how carefully Amazon is playing its role as a platform provider. The new console competes in part with products from RightScale, Elastra (which has backing from Amazon) and Enomaly, but doesn’t crush them out of existence. Currently those vendors offer management products beyond Amazon’s — either in functionality or in managing other clouds too.
I had wondered before whether or not Amazon would launch features that would make startups building around its platform obsolete. I came to the conclusion that Amazon’s willingness to share information would help vendors plan ahead in time for them to shift or expand beyond EC2 or other Amazon products.
A quick peek at RightScale’s blog entry about this potential business threat shows that it had some warning and was thinking about this announcement ahead of time — but it still may cause problems. RightScale points out that some of its business comes from developers trying out their free product (which is similar to Amazon’s) and then paying to upgrade for more features. If those developers go straight to Amazon, RightScale may miss a chance to convert some sales. Michale Crandell, CEO of RightScale says he doens’t know if that will be a problem, but he doesn’t think the Amazon console directly threatens his business.
Smart startups accept that they will need to expand beyond Amazon quickly and pump more money into their marketing efforts to showcase why their subscription products add value to what Amazon does and will offer.