Home Technology IBM In Pitched Battle With Amazon Web Services Over Cloud Computing

IBM In Pitched Battle With Amazon Web Services Over Cloud Computing

When you purchase through our sponsored links, we may earn a commission. By using this website you agree to our T&Cs.

Recently, any thoughts I’ve given to the Amazon, or Amazon.com, Inc. (NASDAQ:AMZN), revolve around my failures to heed the sagely advice given both in Conrad’s “Heart of Darkness” and the 1979 film Apocalypse Now…”Stay in the (effing) boat.” Instead, I chased a monkey that stole a bottle of rum from us just far enough to get bit by a snake the size of my last sentence.

Amazon Web Services under attack from IBM

Amazon Web Services, not to be confused with Internet retailer Amazon.com, Inc. (NASDAQ:AMZN), has found itself under attack from International Business Machines Corp. (NYSE:IBM) in recent days as the two jockey to become major players in cloud computing. Unlike myself in the Ecuadorian Amazon, however, AWS is biting back.

While one might think that following the Snowden affair, companies would be looking to distance themselves from American intelligence agencies, apparently, the opposite is true. Amazon Web Services recently beat out IBM for a $600 million CIA contract and International Business Machines Corp. (NYSE:IBM)’s response was simple and swift: a smear campaign where IBM implicitly labels AWS its rival through a series of print, online, and outdoor advertisements.

“Whose cloud powers 270,000 more websites than Amazon?” asks one print advertisement that will run in some major newspapers and business magazines. “If your answer is IBM, you’re among the well informed. The International Business Machines Corp. (NYSE:IBM) cloud offerings also support 30% more of the most popular websites than anyone else in the world.”

If that seems a touch desperate and you’re familiar with the fact that IBM rarely mentions its rivals in its advertising, remember that cloud computing is a $40 billion annual business.

Amazon Web Services retaliates

Today, Amazon Web Services fired back. Amazon Web Services chief Andy Jassy, during an address Wednesday at its annual conference, said IBM is just “jumping up and down” in an attempt to “confuse customers” about its cloud computing offerings.

Firing back, International Business Machines Corp. (NYSE:IBM) vice president of cloud services Ric Telford explained that the campaign was largely launched because it recently completed its $2 billion acquisition of SoftLayer Technologies Inc., and it needs to highlight this acquisition.

“We’re not being shy about spreading the word that unlike Amazon.com, Inc. (NASDAQ:AMZN), International Business Machines Corp. (NYSE:IBM) has a long history of delivering trusted, secure and open cloud services for years,” said Nancy Pearson, vice president of IBM’s cloud marketing, in an emailed statement Wednesday following Jassy’s comments. “As more clients embrace cloud computing to transform their businesses, IBM continues to infuse high value capabilities, such as our acquisition of SoftLayer and continuous support for open cloud standards. Through this campaign, we’re taking the facts about our cloud leadership straight to customers.”

International Business Machines Corp. (NYSE:IBM), until recently, chose not to disclose its cloud revenue. In July, that changed with IBM stating that they took in $1 billion in cloud service revenue last year for a gain of 70% over the year prior. It’s believed that AWS sees $3 billion in revenue annually for its work in this arena.

Our Editorial Standards

At ValueWalk, we’re committed to providing accurate, research-backed information. Our editors go above and beyond to ensure our content is trustworthy and transparent.

Brendan Byrne

Want Financial Guidance Sent Straight to You?

  • Pop your email in the box, and you'll receive bi-weekly emails from ValueWalk.
  • We never send spam — only the latest financial news and guides to help you take charge of your financial future.