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Amazon Keeps Investing in Amazon Web Services

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Amazon launched products like Aurora and QuickSight this year

In the prior parts of this series, we discussed Amazon’s (AMZN) key investment initiatives while saving costs wherever possible. Another major investment area for Amazon is its cloud services segment, Amazon Web Services (or AWS). From just January to October 2015, Amazon added 540 new features to AWS. Amazon launched its relational database with AWS, named Amazon Aurora, in July this year. The company claims that Aurora is its fastest-growing service ever. Amazon also launched Amazon QuickSight for AWS, which is a big-data analytics and visualization tool.

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On top of that, Amazon continues to lower prices of AWS to remain competitive. Amazon made a large price cut in April 2014, and ever since then, it has cut prices eight times. Amazon is now expanding its AWS service in Europe (EFA). It already has data centers in Ireland and Germany and plans to open a new one in the United Kingdom.

AWS remains the growth driver for Amazon

AWS revenues grew by a year-over-year rate of 78% to $2.1 billion while the segment’s operating profits grew by an impressive five times from $98 million in 3Q14 to $521 million in 3Q15. These results for Amazon shows that the company is successfully managing to grow its cloud services business. According to a report from Synergy Research Group, Amazon clearly leads the cloud infrastructure services market with a share of 29%. Microsoft (MSFT), IBM (IBM), and Google (GOOG) are the other main players in this market.

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