AWS Dominance continues (650 Group cloud report)

AWS (Amazon Web Services) grew nearly 30% Y/Y, remarkable results for a $10B a quarter business. 650 Group enterprise interviews indicate that IaaS is the preferred platform for new application development in the new-normal COVID-19 world.

We do expect at some point enterprises will move some of these workloads back to the premise, but don’t expect a headwind. Still, more of normalization as this premises-based move in 2021 will be occurring right as AI workloads add a new leg of growth to IaaS providers.

AWS Custom ASIC and semi-custom ASIC development include many projects beyond Annapurna’s Smart NIC and Amazon’s investment into satellite connectivity with a $10B investment in project Kuiper for low earth satellites in direct competition with SpaceX’s Starlink will make the company’s Cloud platform even more popular. Also, if satellite connectivity is just for media, which we see as unlikely, the way consumers connect their devices over the next decade is going to go through a significant transformation, and this is just the best-case will have a minimal impact.