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Amazon and Zynga partner on Word Pop, a Words with Friends spinoff created for Alexa
Zynga’s popular game, Words with Friends, is coming to Alexa. The new voice-powered game will be known as Word Pop, and — sorry — you can’t actually play it with friends right now, even though the game lives within Zynga’s broader Words with Friends franchise. Instead, the new Alexa voice game is viewed as a complement to Zynga’s multiplayer version. It’s a place where players can sharpen their word-building skills, no friends required.
To launch Word Pop, you’ll say “Alexa, open Word Pop” on any Alexa device to get started.
In the game, Alexa will challenge the players to create as many words as possible from a six-letter bank, through a series of one-minute sessions. During this time, players must say or spell as many words as they can, while earning points for both the number and length of the words they find.
On Alexa devices with a screen, like the Echo Show, there will also be a visual component where players will see their letter banks and completed words. Arguably, the game is better this way as it allows you to view the letters and combinations much like you can on a mobile device or computer. Without the screen, the game will prove much more challenging — though that may appeal to some Words with Friends experts.
The companies characterize their teaming up on the new title as a “partnership,” where both Amazon and Zynga’s teams worked together to build the game. However, there isn’t currently a revenue-sharing situation, we understand, as the game is free and doesn’t offer in-app purchases. (Of course, if the title proves popular enough, the companies could likely revisit that decision.)
In the meantime, however, the companies see the opportunity to build their respective brands. Zynga can generate interest in its aging, cross-platform Words with Friends franchise by way of the new Alexa skill, while Amazon gets to introduce the idea of Alexa gaming to consumers via a well-known industry brand and popular game that users will already know how to play.
“I’m thrilled that by adding Word Pop to the Words With Friends family, players will be able to test and improve their word skills, making them even better Words With Friends players,” said Bernard Kim, president of Publishing at Zynga, in a statement. “The beauty of Words With Friends is that even after ten years, we’re still discovering new ways for the franchise to bring joy to players around the world. We’re dedicated to experimenting with services such as Alexa and game modes like Word Pop, which gives players a familiar, yet novel experience.”
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Slack’s new integration deal with AWS could also be about tweaking Microsoft
Slack and Amazon announced a big integration late yesterday afternoon. As part of the deal, Slack will use Amazon Chime for its call feature, while reiterating its commitment to use AWS as its preferred cloud provider to run its infrastructure. At the same time, Amazon has agreed to offer Slack as an option for all internal communications.
“Some parts of Amazon had licensed Slack before, but this is the first time it will be offered as an option to all employees,” an Amazon spokesperson told TechCrunch.
Make no mistake, this is a big deal as the SaaS communications tool increases its ties with AWS, but this agreement could also be about slighting Microsoft and its rival Teams product by making a deal with a cloud rival. In the past, Slack CEO Stewart Butterfield has had choice words for Microsoft saying the Redmond technology giant sees his company as an “existential threat.”
Whether that’s true — Teams is but one piece of a huge technology company — it’s impossible not to look at the deal in this context. Aligning more deeply with AWS sends a message to Microsoft, whose Azure infrastructure services compete with AWS.
Butterfield didn’t say that of course. He talked about how synergistic the deal was. “Strategically partnering with AWS allows both companies to scale to meet demand and deliver enterprise-grade offerings to our customers. By integrating AWS services with Slack’s channel-based messaging platform, we’re helping teams easily and seamlessly manage their cloud infrastructure projects and launch cloud-based services without ever leaving Slack,” he said in a statement.
The deal also includes several other elements including integrating AWS Key Management Service with Slack Enterprise Key Management (EKM) for encryption key management, deeper alignment with AWS’s chatbot service and direct integration with AWS AppFlow to enable secure transfer of data between Slack and Amazon S3 storage and the Amazon Redshift data warehouse.
AWS CEO Andy Jassy saw it as a pure integration play. “Together, AWS and Slack are giving developer teams the ability to collaborate and innovate faster on the front end with applications, while giving them the ability to efficiently manage their backend cloud infrastructure,” Jassy said in a statement.
Like any good deal, it’s good for both sides. Slack gets a big customer in AWS and AWS now has Slack directly integrating more of its services. One of the reasons enterprise users are so enamored with Slack is the ability to get work done in a single place without constantly having to change focus and move between interfaces.
This deal will provide more of that for common customers, while tweaking a common rival. That’s what you call win-win.
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Directly, which taps experts to train chatbots, raises $11M, closes out Series B at $51M
Directly, a startup whose mission is to help build better customer service chatbots by using experts in specific areas to train them, has raised more funding as it opens up a new front to grow its business: APIs and a partner ecosystem that can now also tap into its expert network. Today Directly is announcing that it has added $11 million to close out its Series B at $51 million (it raised $20 million back in January of this year, and another $20 million as part of the Series B back in 2018).
The funding is coming from Triangle Peak Partners and Toba Capital, while its previous investors in the round included strategic backers Samsung NEXT and Microsoft’s M12 Ventures (who are both customers, alongside companies like Airbnb), as well as Industry Ventures, True Ventures, Costanoa Ventures and Northgate. (As we reported when covering the initial close, Directly’s valuation at that time was at $110 million post-money, and so this would likely put it at $120 million or higher, given how the business has expanded.)
While chatbots have now been around for years, a key focus in the tech world has been how to help them work better, after initial efforts saw so many disappointing results that it was fair to ask whether they were even worth the trouble.
Directly’s premise is that the most important part of getting a chatbot to work well is to make sure that it’s trained correctly, and its approach to that is very practical: find experts both to troubleshoot questions and provide answers.
As we’ve described before, its platform helps businesses identify and reach out to “experts” in the business or product in question, collect knowledge from them, and then fold that into a company’s AI to help train it and answer questions more accurately. It also looks at data input and output into those AI systems to figure out what is working, and what is not, and how to fix that, too.
The information is typically collected by way of question-and-answer sessions. Directly compensates experts both for submitting information as well as to pay out royalties when their knowledge has been put to use, “just as you would in traditional copyright licensing in music,” its co-founder Antony Brydon explained to me earlier this year.
It can take as little as 100 experts, but potentially many more, to train a system, depending on how much the information needs to be updated over time. (Directly’s work for Xbox, for example, used 1,000 experts but has to date answered millions of questions.)
Directly’s pitch to customers is that building a better chatbot can help deflect more questions from actual live agents (and subsequently cut operational costs for a business). It claims that customer contacts can be reduced by up to 80%, with customer satisfaction by up to 20%, as a result.
What’s interesting is that now Directly sees an opportunity in expanding that expert ecosystem to a wider group of partners, some of which might have previously been seen as competitors. (Not unlike Amazon’s AI powering a multitude of other businesses, some of which might also be in the market of selling the same services that Amazon does).
The partner ecosystem, as Directly calls it, use APIs to link into Directly’s platform. Meya, Percept.ai, and SmartAction — which themselves provide a range of customer service automation tools — are three of the first users.
“The team at Directly have quickly proven to be trusted and invaluable partners,” said Erik Kalviainen, CEO at Meya, in a statement. “As a result of our collaboration, Meya is now able to take advantage of a whole new set of capabilities that will enable us to deliver automated solutions both faster and with higher resolution rates, without customers needing to deploy significant internal resources. That’s a powerful advantage at a time when scale and efficiency are key to any successful customer support operation.”
The prospect of a bigger business funnel beyond even what Directly was pulling in itself is likely what attracted the most recent investment.
“Directly has established itself as a true leader in helping customers thrive during these turbulent economic times,” said Tyler Peterson, Partner at Triangle Peak Partners, in a statement. “There is little doubt that automation will play a tremendous role in the future of customer support, but Directly is realizing that potential today. Their platform enables businesses to strike just the right balance between automation and human support, helping them adopt AI-powered solutions in a way that is practical, accessible, and demonstrably effective.”
In January, Mike de la Cruz, who took over as CEO at the time of the funding announcement, said the company was gearing up for a larger Series C in 2021. It’s not clear how and if that will be impacted by the current state of the world. But in the meantime, as more organizations are looking for ways to connect with customers outside of channels that might require people to physically visit stores, or for employees to sit in call centres, it presents a huge opportunity for companies like this one.
“At its core, our business is about helping customer support leaders resolve customer issues with the right mix of automation and human support,” said de la Cruz in a statement. “It’s one thing to deliver a great product today, but we’re committed to ensuring that our customers have the solutions they need over the long term. That means constantly investing in our platform and expanding our capabilities, so that we can keep up with the rapid pace of technological change and an unpredictable economic landscape. These new partnerships and this latest expansion of our recent funding round have positioned us to do just that. We’re excited to be collaborating with our new partners, and very thankful to all of our investors for their support.”
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Mozilla goes full incubator with ‘Fix The Internet’ startup lab and early-stage investments
After testing the waters this spring with its incubator-esque MVP Lab, Mozilla is doubling down on the effort with a formal program dangling $75,000 investments in front of early-stage companies. The focus on “a better society” and the company’s open-source clout should help differentiate it from the other options out there.
Spurred on by the success of a college hackathon using a whole four Apple Watches in February, Mozilla decided to try a more structured program in the spring. The first test batch of companies is underway, having started in April an 8-week program offering $2,500 per team member and $40,000 in prizes to give away at the end. Developers in a variety of domains were invited to apply, as long as they fit the themes of empowerment, privacy, decentralization, community and so on.
It drew the interest of some 1,500 people in 520 projects, and 25 were chosen to receive the full package and stipend during the development of their MVP. The rest were invited to an “Open Lab” with access to some of Mozilla’s resources.
One example of what they were looking for is Ameelio, a startup whose members are hoping to render paid video calls in prisons obsolete with a free system, and provide free letter delivery to inmates as well.
“The mission of this incubator is to catalyze a new generation of internet products and services where the people are in control of how the internet is used to shape society,” said Bart Decrem, a Mozilla veteran (think Firefox 1.0) and one of the principals at the Builders Studio. “And where business models should be sustainable and valuable, but do not need to squeeze every last dollar (or ounce of attention) from the user.”
“We think we are tapping into the energy in the student and professional ‘builder communities’ around wanting to work on ideas that matter. That clarion call really resonates,” he said. Not only that, but students with canceled internships are showing up in droves, it seems — mostly computer science, but design and other disciplines as well. There are no restrictions on applicants, like country of origin, previous funding, or anything like that.
The new incubator will be divided into three tiers.
First is the “Startup Studio,” which involves a $75,000 investment, “a post-money SAFE for 3.5% of the company when the SAFE converts (or we will participate in an already active funding round),” Decrem clarified.
Below that, as far as pecuniary commitment goes, is the “MVP Lab,” similar to the spring program but offering a total of $16,000 per team. And below that is the Open Lab again, but with 10 $10,000 prizes rather than a top 3.
There are no hard numbers on how many teams will make up the two subsidized tiers, but think 20-30 total as opposed to 50 or 100. Meanwhile, collaboration, cross-pollination and open-source code is encouraged, as you might expect in a Mozilla project. And the social good aspect is strong as well, as a sampling of the companies in the spring batch shows.
Neutral is a browser plugin that shows the carbon footprint of your Amazon purchases, adding some crucial guilt to transactions we forget are powered by footsore humans and gas-guzzling long-distance goods transport. Meething, Cabal and Oasis are taking on video conferencing, team chat and social feeds from a decentralized standpoint, using the miracles of modern internet architecture to accomplish with distributed systems what once took centralized servers.
This summer will see the program inaugurated, but it’s only “the beginning of a multiyear effort,” Decrem said.
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Intel has invested $132M in 11 startups this year, on track for $300M-$500M in total
When it comes to corporate venture capital, semiconductor giant Intel has shaped up to be one of the most prolific and prescient investors in the tech world, with investments in 1,582 companies worldwide, and a tally of some 692 portfolio companies going public or otherwise exiting in the wake of Intel’s backing.
Today, the company announced its latest tranche of deals: $132 million invested in 11 startups. The deals speak to some of the company’s most strategic priorities currently and in the future, covering artificial intelligence, autonomous computing and chip design.
Many corporate VCs have been clear in drawing a separation between their activities and that of their parents, and the same has held for Intel. But at the same time, the company has made a number of key moves that point to how it uses its VC muscle to expand its strategic relationships and also ultimately expand through M&A. Just earlier this month, it acquired Moovit, an Intel Capital portfolio company, for $900 million (a deal that was knocked down to $840 million when accounting for its previous investment).
“Intel Capital identifies and invests in disruptive startups that are working to improve the way we work and live. Each of our recent investments is pushing the boundaries in areas such as AI, data analytics, autonomous systems and semiconductor innovation. Intel Capital is excited to work with these companies as we jointly navigate the current world challenges and as we together drive sustainable, long-term growth,” said Wendell Brooks, Intel senior vice president and president of Intel Capital, in a statement.
The tranche of deals come at a critical time in the worlds of startups and venture investing. Many are worried that the slowdown in the economy, precipitated by the COVID-19 pandemic, will mean a subsequent slowdown in tech finance. Intel says that it plans to invest between $300 million and $500 million in total this year, so this would go some way to refuting that idea, along with some of the other monster deals and big funds that we’ve written out in the last couple of months.
The list announced today doesn’t include specific investment numbers, but in some cases the startups have also announced the fundings themselves and given more detail on round sizes. These still, however, do not reveal Intel’s specific financial stakes.
Here’s the full list:
- Anodot uses machine learning to monitor business operations autonomously, covering areas like app performance, customer incidents and more. The idea is that using the platform to monitor for these incidents means detection and response time can be faster. The full $35 million round was announced back in April.
- Astera Labs is a fabless semiconductor startup focused on connectivity solutions for data-centric systems to remove performance bottlenecks in compute-intensive workloads in areas like AI. It announced its Series B of an undisclosed amount two weeks ago, and prior to this it had raised just over $6 million, according to PitchBook.
- Axonne develops next-generation high-speed automotive Ethernet network connectivity solutions for connected cars: addressing the issue of merging legacy or proprietary systems with the demands of advanced next-generation applications. Intel invested as part of a $9 million round that actually closed in March.
- Hypersonix uses big-data analytics to determine and predict customer demand for e-commerce, retail and hospitality customers. One of its customers is Amazon — which uses Hypersonix’s platform in its supply chain division. That may come as a surprise, but according to Hypersonix’s CEO, the e-commerce giant does not have dedicated analytics teams to serve every division in the company, so sometimes they do buy from third parties. The round was actually announced at the beginning of this month: an $11.5 million deal.
- KFBIO out of China is one of Intel’s biotechnology bets. The company has designed and built a digital pathology scanner, which aims to replace microscopes with its big data, cloud-based and AI-powered insights. The obvious connection and interest here for Intel is on the processor side, but potentially brings Intel into a sphere where it can flex its muscle around a range of AI and cloud computing applications as well. The deal was closed at the beginning of April and totals around $14.2 million.
- Lilt has built an AI-powered language translation platform, not to compete with the likes of Google Translate for consumers, but to help those with international-facing websites and apps localise their services more efficiently. The company announced its round today: a $25 million Series B led by Intel.
- MemVerge focuses on “in-memory” computing, an architecture that makes it easier to deploy heavy, data-centric applications. It closed its round of $24.5 million at the beginning of April, and while it’s always worked with Intel processors, Intel’s investment was not public until today.
- ProPlus Electronics, also out of China, is an electronic design automation (“EDA”) startup that speeds up chip design and fabrication for semiconductor companies manufacturing a variety of chips at scale. It closed its round also at the beginning of April. The exact amount was undisclosed except to note that it was in the “hundreds of millions of Chinese Yuan” (or tens of millions of U.S. dollars).
- Retrace is an under-the-radar dental data startup that uses AI to improve “dental decision making,” but according to its site seems also to focus on other healthcare areas. It’s not clear how big the round is or when it closed.
- Spectrum Materials out of China is another stealthy company that supplies gas and other materials to semiconductor makers.
- Xsight Labs based in Israel is building chipset designs to accelerate data-intensive workloads that you typically get with AI and analytical applications. Israel has a huge R&D centre focused on autonomous driving, one of the applications that’s going to demand a lot in processing power, so this looks like a clearly strategic bet. The company raised $25 million in February, but Intel was not disclosed in that round previously.
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Xiaomi spinoff POCO’s F2 Pro undercuts Android rivals with low price and flagship features
POCO, a brand that spun out of Chinese electronics giant Xiaomi earlier this year, today launched the POCO F2 Pro smartphone as it continues its new journey as an independent firm.
The POCO F2 Pro, like its two-year-old sleeper hit predecessor Pocophone F1 smartphone, punches above its price class. It features an all-screen 6.67-inch full-HD+ AMOLED display (with 2400×1080 pixels), in-screen fingerprint scanner, support for 5G, quad-core rear camera setup and a pop-up front camera that quietly tucks away when not in use. It also features a 3.5mm headphone jack.
The smartphone comes in two variants: one with 6GB of RAM and 128GB internal storage that is priced at €499 (roughly $540), and the other that features 8GB of RAM and 256GB internal storage that costs €599 (roughly $650).
Both the variants run Android 10 and are going on sale globally starting Tuesday through Gearbest and Aliexpress e-commerce sites. POCO said it will soon begin selling the POCO F2 Pro on Amazon, Lazada and Shopee among other e-commerce sites, including its official website.
The dual-SIM card-supported smartphone, a popular feature in several Asian markets, is powered by Qualcomm’s flagship octa-core Snapdragon 865 processor, coupled with Adreno 650GPU. POCO F2 Pro also sports what the company claims to be the largest vapor chamber in any smartphone to support LiquidCool, a technology that keeps the device cool even when a user is playing high-end games such as Fortnite and PUBG.
A total score of 589,983.
CPU Benchmark score of 184,817.
GFXbench Manhattan 4.0 benchmark score of 40.
Yes, the #POCOF2Pro is simply #PowerfullyCool! pic.twitter.com/KgyHJt2dI4
— POCO (@POCOGlobal) May 12, 2020
On the camera front, the POCO F2 Pro features a 64MP Sony IMX686 sensor, which serves as the primary camera, with a 13MP ultra wide-angle lens, a 5MP macro and one 2MP depth sensor. The pop-up camera, which serves as the selfie sensor, is a 20MP lens. The rear camera setup is capable of recording videos in 8K resolution at 24fps, and 4K in 60fps.
The POCO F2 Pro, which comes in Neon Blue, Electric Purple, Cyber Grey, Phantom White, houses a 4,700mAh battery with support for fast charging, and ships with a 33W charger in the box.
POCO listed a number of additional features that other flagship Android smartphones offer, such as support for HDR10+, display brightness of 500 nits, Corning Gorilla Glass 5 that protects the screen and an IR blaster. But its display lacks support for 120Hz refresh rate — as seen on OnePlus 8T Pro that makes viewing experience extra smooth.
POCO F2 Pro is the second smartphone from the company since it spun out of Xiaomi earlier this year. The company’s first product, called Pocophone F1, launched in 2018 and was well received by the market.
At the time of the launch, Xiaomi executives said they had big plans for the POCO brand but never launched anything afterward. During the period the company also saw a big departure when Jai Mani, a senior product executive, left the firm. Earlier this year, the company launched the mid-range POCO X2 smartphone in India.
POCO executives today shared little plans on what the future holds for the firm, but assured that they are here to stay. “We’re back. It’s been awhile, but we are back,” said Angus Ng, a product marketing manager at POCO.
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Amazon releases Kendra to solve enterprise search with AI and machine learning
Enterprise search has always been a tough nut to crack. The Holy Grail has always been to operate like Google, but in-house. You enter a few keywords and you get back that nearly perfect response at the top of the list of the results. The irony of trying to do search locally has been a lack of content.
While Google has the universe of the World Wide Web to work with, enterprises have a much narrower set of responses. It would be easy to think that should make it easier to find the ideal response, but the fact is that it’s the opposite. The more data you have, the more likely you’ll find the correct document.
Amazon is trying to change the enterprise search game by putting it into a more modern machine learning-driven context to use today’s technology to help you find that perfect response just as you typically do on the web.
Today the company announced the general availability of Amazon Kendra, its cloud enterprise search product that the company announced last year at AWS re:Invent. It uses natural language processing to allow the user to simply ask a question, then searches across the repositories connected to the search engine to find a precise answer.
“Amazon Kendra reinvents enterprise search by allowing end-users to search across multiple silos of data using real questions (not just keywords) and leverages machine learning models under the hood to understand the content of documents and the relationships between them to deliver the precise answers they seek (instead of a random list of links),” the company described the new service in a statement.
AWS has tuned the search engine for specific industries including IT, healthcare and insurance. It promises energy, industrial, financial services, legal, media and entertainment, travel and hospitality, human resources, news, telecommunications, mining, food and beverage and automotive will be coming later this year.
This means any company in one of those industries should have a head start when it comes to searching because the system will understand the language specific to those verticals. You can drop your Kendra search box into an application or a website, and it has features like type ahead you would expect in a tool like this.
Enterprise search has been around for a long time, but perhaps by bringing AI and machine learning to bear on it, we can finally solve it once and for all.
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Microsoft and AWS exchange poisoned pen blog posts in latest Pentagon JEDI contract spat
Microsoft and Amazon are at it again as the fight for the Defense Department JEDI contract continues. In a recent series of increasingly acerbic pronouncements, the two companies continue their ongoing spat over the $10 billion, decade-long JEDI contract spoils.
As you may recall (or not), last fall in a surprise move, the DoD selected Microsoft as the winning vendor in the JEDI winner-take-all cloud infrastructure sweepstakes. The presumed winner was always AWS, but when the answer finally came down, it was not them.
To make a very long story short, AWS took exception to the decision and went to court to fight it. Later it was granted a stay of JEDI activities between Microsoft and the DoD, which as you can imagine did not please Microsoft . Since then, the two companies have been battling in PR pronouncements and blog posts trying to get the upper hand in the war for public opinion.
That fight took a hard turn this week when the two companies really went at it in dueling blog posts after Amazon filed its latest protest.
First there was Microsoft with PR exec Frank Shaw taking exception to AWS’s machinations, claiming the company just wants a do-over:
This latest filing – filed with the DoD this time – is another example of Amazon trying to bog down JEDI in complaints, litigation and other delays designed to force a do-over to rescue its failed bid.
Amazon’s Drew Herdner countered in a blog post published this morning:
Recently, Microsoft has published multiple self-righteous and pontificating blog posts that amount to nothing more than misleading noise intended to distract those following the protest.
The bottom line is that Microsoft believes it won the contract fair and square with a more competitive bid, while Amazon believes it should have won on technical superiority, and that there was political interference from the president because he doesn’t like Amazon CEO Jeff Bezos, who also owns the Washington Post.
If you’ve been following this story from the beginning (as I have), you know it has taken a series of twists and turns. It’s had lawsuits, complaints, drama and intrigue. The president has inserted himself into it, too. There have been accusations of conflicts of interest. There have been investigations, lawsuits and more investigations.
Government procurement tends to be pretty bland, but from the start when the DoD chose to use the cutesy Star Wars-driven acronym for this project, it has been anything but. Now it’s come down to two of the world’s largest tech companies exchanging angry blog posts. Sooner or later this is going to end right?
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How will digital media survive the ad crash?
When I first met Bustle Digital Group’s Jason Wagenheim, it was right as New York City was beginning to go into lockdown. The BDG offices were empty thanks to the company’s newly instituted work-from-home policy, but it still seemed reasonable to meet in-person to learn more about BDG’s broader vision.
At the time, Wagenheim — a former Fusion and Condé Nast executive who joined BDG as chief revenue officer before becoming president in February — acknowledged that we were entering a period of uncertainty, but he sounded a note of cautious optimism for the year ahead.
Since then, of course, things have been pretty rough for the digital media industry (along with the rest of the world), with a rapid reduction in ad spending leading to layoffs, furloughs and pay cuts. BDG (which owns properties like Elite Daily, Input, Inverse, Nylon and Bustle itself) had to make its share of cuts, laying off two dozen employees, including the entire staff of The Outline.
And indeed, when I checked back in with Wagenheim, he told me that he’s anticipating a 35% decline in ad revenue for this quarter. And where he’d once hoped BDG would reach $120 or $125 million in ad revenue this year, he’s now trying to figure out “what does our company look like at $75 or $90 million?”
At the same time, he insisted that executives were determined not to completely dismantle the businesses they’d built, and to be prepared whenever advertising does come back.
We also discussed how Wagenheim handled the layoffs, how the company is reinventing its events sponsorship business and the trends he’s seeing in the ad spending that remains. You can read an edited and condensed version of our conversation below.
TechCrunch: We should probably just start with the elephant in the room, which is that you guys had to make some cuts recently. You were hardly the only ones, but do you want to talk about the thought process behind them?
Jason Wagenheim: Yeah, we ended up having to say goodbye to about 7% of our team, and we had salary reductions to the tune of 18% company-wide for those that made over $70,000. And then we had 30% pay cuts for executives.
You’ve read about all this, I’m sure. It was a really, really hard decision. We spent two weeks in planning, dozens of spreadsheets, negotiating with our investors on a plan that would keep the company moving forward, but [had to] be very sober to the reality of what was happening around us. But also most importantly for us, for our executive team, we weren’t about to disassemble the company that we spent the last 12 to 18 months building.
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In spite of pandemic (or maybe because of it), cloud infrastructure revenue soars
It’s fair to say that even before the impact of COVID-19, companies had begun a steady march to the cloud. Maybe it wasn’t fast enough for AWS, as Andy Jassy made clear in his 2019 Re:invent keynote, but it was happening all the same and the steady revenue increases across the cloud infrastructure market bore that out.
As we look at the most recent quarter’s earnings reports for the main players in the market, it seems the pandemic and economic fall out has done little to slow that down. In fact, it may be contributing to its growth.
According to numbers supplied by Synergy Research, the cloud infrastructure market totaled $29 billion in revenue for Q12020.
Image Credit: Synergy Research
Synergy’s John Dinsdale, who has been watching this market for a long time, says that the pandemic could be contributing to some of that growth, at least modestly. In spite of the numbers, he doesn’t necessarily see these companies getting out of this unscathed either, but as companies shift operations from offices, it could be part of the reason for the increased demand we saw in the first quarter.
“For sure, the pandemic is causing some issues for cloud providers, but in uncertain times, the public cloud is providing flexibility and a safe haven for enterprises that are struggling to maintain normal operations. Cloud provider revenues continue to grow at truly impressive rates, with AWS and Azure in aggregate now having an annual revenue run rate of well over $60 billion,” Dinsdale said in a statement.
AWS led the way with a third of the market or more than $10 billion in quarterly revenue as it continues to hold a substantial lead in market share. Microsoft was in second, growing at a brisker 59% for 18% of the market. While Microsoft doesn’t break out its numbers, using Synergy’s numbers, that would work out to around $5.2 billion for Azure revenue. Meanwhile Google came in third with $2.78 billion.
If you’re keeping track of market share at home, it comes out to 32% for AWS, 18% for Microsoft and 8% for Google. This split has remained fairly steady, although Microsoft has managed to gain a few percentage points over the last several quarters as its overall growth rate outpaces Amazon.
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