AWS re:Invent 2022 shines a light on progress through thematic developments

AWS re:Invent returned to Las Vegas at full throttle this year with more than 55,000 attendees, more than double the number of in-person registrations at 2021's scaled down in-person event, although still shy of 2019's 100,000. A slew of net-new services were introduced, but most were incremental additions to what already exists. Amazon.com Inc.'s Amazon Web Services Inc. changed things up a bit this year in the keynotes by embedding announcements in broader narratives centered on important thematic developments such as "working backwards," co-creation and partnerships, simplification and integration, and industry-specific technology.

Overall progress was also demonstrated; more new markets and workloads are moving to the cloud, from HPC to financial services. Cost savings, efficiency and value creation are now established, and expected, cloud dividends. CEO Adam Selipsky's keynote foregrounded AWS as a business running on renewables and focused on sustainability and referenced a recent visit to Japan, where the executive said about 75% of chief investment officers and CEOs he met asked specifically about AWS' sustainability strategy.

Changing the perception of the company as a scale-out cloud player to being an enterprise-centric IT partner will not be easy, but the latest thematic developments suggest that AWS has the means to do this. Working backwards with customers seems to be paying off as it continues to support diverse use cases across the entire business spectrum. While the vertical play is far from revolutionary, it allows AWS to build a story that underpins its global brand with deep industry knowledge and established relationships. On the partnership front, there is a strong appetite for developing segment- or vertical-specific competencies as pockets of opportunities emerge in key industry verticals and service segments. Co-innovation has become a holy grail to allow partners to move in uncharted waters. As modern innovations continue to evolve, mastering the science of simplicity will be indispensable.

re:Invent 2022 roundup

In the context of IT agility, enabling businesses to grow their digital footprint remains a core part of the AWS value proposition. In addition to deepening its platform capabilities with new and enhanced features to address larger and more complex transformational issues, the company sees collaborative innovation with partners and customers as the way forward. Overall, the narrative approach to business announcements seems refreshing, and several thematic developments were brought to light, as described below.

The "working backwards" methodology takes center stage

As AWS seeks to engage more deeply with large enterprises, the notion of working backward and focusing on customer outcomes is more than just a philosophy. It has come to define how the company designs products, develops programs and invests in new capabilities. As application modernization puts more emphasis on organizational changes, inadequate technical and operational skills continue to be an obstacle for some organizations, according to AWS.

For established programs like the Migration Acceleration Program, or MAP, AWS continues to put financial skin in the game. Positioned as a proven framework to workload migration, AWS MAP — along with the AWS three-pronged model for migration (Assess, Mobilize and Migration + Modernize) — provides an ecosystem of support to help customers overcome what the company has seen to be common barriers to successful migration and modernization efforts.

The Readiness Assessment is a one-day workshop to align the management team and lay out an action plan to close the gaps. An action plan includes building landing zones, establishing security controls and accelerating early momentum to gain confidence. Not every enterprise workload can be migrated to the cloud; therefore, action plans will often include application retirement strategies or adoption of AWS Outposts. There is a growing network of migration partners that are audited annually on the basis of competencies and are required to have achieved at least Advanced AWS Consulting Partner status.

AWS' website lists a network of more than 100 Migration Competency Partners, many of which are currently pursuing opportunities in the Asia-Pacific region. In addition to established brands such as Accenture PLC, Cognizant, Deloitte and Tata Consultancy Services Ltd., regional and local partners Datacom Group Ltd (Australia and in New Zealand), Blazeclan (Singapore and India), Classmethod (Japan) and CloudKinetics (ASEAN) are developing their migration practice. By focusing on eight major enterprise workloads, including mainframe, SAP SE, Windows or VMware Inc., migration partners will help customers create the case for change and mobilize resources for actual migration and modernization.

With MAP, AWS says financial benefits may go directly to clients and/or partners, depending on the scope of migration and the extent of support. Although it has its own professional services team, the company stresses that in the typical scenario, consultants work alongside migration partners on migration projects.

Co-innovation with partners

Achieving business outcomes generally requires the use of multiple services. As a result, AWS believes that creating a culture of collaboration is essential to fostering innovation across the various layers of the IT stack. In addition to forging strategic collaborative agreements with leading global systems integrators, managed IT specialists and technology providers for multiyear investments in skills enablement (Wipro Ltd.'s Step Up program) and cloud transformation initiatives (the global strategic transformation agreement with Atos SE), AWS has started preparing its product and support teams for changes, leveraging industry-specific capabilities from GSI partners.

AWS concluded its first GSI partner agreement with Accenture in 2015 and now works with several GSIs, including Deloitte, Wipro, TCS, DXC Technology Co. and Atos. Although these partnerships initially focused on horizontal infrastructure projects, they now feature considerable co-creation and purpose-built industry technology building. Examples include AWS' work with Deloitte on platforms for healthcare and life sciences, digital banking and smart manufacturing. AWS also has strategic collaboration and co-innovation arrangements with customers/partners such as GE HealthCare and Siemens AG.

Given that supporting data governance and regulatory compliance are considered table stakes, more and more companies are committed to building sovereign cloud practices, including Accenture, Red Hat and VMware. Their commitment was surely considered by AWS when the company announced the AWS Digital Sovereignty Pledge the day before the official kickoff of re:Invent 2022.

This promise will likely be supported by a set of sovereignty controls and functionality in its cloud. New features for existing services can be seen as precursors. These include AWS Control Tower (comprehensive controls management) as well as announced previews of AWS DataZone (companywide data governance) and AWS Clean Rooms (collaboration with business partners on datasets without moving or sharing the underlying data). But more are expected to come online in 2023 with and through partners.

Another recurring theme of the partner community is sustainability, which is now part of the competitive differentiation of AWS partners as business models, suppliers and users. By teaming up with Wasteless and other partners, Capgemini SE is hoping to minimize food waste with its dynamic pricing engine and supply chain management. Meanwhile, Accenture, together with Ecopetrol SA and AWS, announced the availability of a cloud-based water management system to reduce water footprint. Internally, a growing number of GSIs have pledged to achieve net-zero emissions in their global operations over the next decade.

Tightening the vertical play

At the event, AWS unveiled a more detailed view of its industry-focused strategy, with targeted vertical business, partner and marketing motions that build on the horizontal product-based approaches already in place for industrial IoT, data analytics, machine learning and telco. Through deeper integration with dedicated industry teams, additional purpose-built offerings and services, and expanding partner programs and competencies, AWS is continuing to drill down into specific vertical segments.

To date, there are 13 industry-specific partner competencies, including the two recent additions: AWS Smart City and AWS Supply Chain Competencies. With AWS Marketplace, ISVs have become the scaling mechanism that enables the company to build the depth and breadth of its vertical play. Nearly a dozen verticals are categorized and/or sub-categorized in AWS Marketplace, with offerings delivered as "solutions."

The company claims to invest equally in all the sectors it selects but admits that some vertical segments such as healthcare and automotive industries are likely to grow faster than others. To that end, offerings such as Amazon HealthLake and Amazon Transcribe Medical have already caught the attention of early adopters Rush University Medical Center, Cortica Inc., Livongo and Quantum Health Inc.

At re:Invent, AWS announced the general availability of Amazon Omics, a new addition to the AWS for Health portfolio. Positioned as a purpose-built data platform to store, query, analyze and generate insights from Genomic and other omics data, Amazon Omics has undergone third-party security assessments and audits with built-in compliance.

To complement its horizontal and vertical collaboration strategies, AWS is also putting more emphasis on incorporating purpose-built technologies such as Amazon Connect into customer and partner offerings. The company announced two new homegrown applications at the event. AWS Supply Chain connects data from ERP and supply chain management via pre-built connectors and aggregates it into unified data lakes for ML-powered insight and planning and collaboration across teams.

The preview version of AWS Supply Chain is available in selected AWS Cloud Regions (North Virginia, Oregon and Frankfurt), and Accenture will incorporate it into its own supply chain offerings. The other purpose-built service, AWS SimSpace Weaver, is a new managed service for large-scale spatial simulation, and is generally available in eight regions across the U.S., Europe and Asia-Pacific.

The company also discussed the AWS Solutions Library, an approach to help customers find offerings specific to their vertical industry and their desired use cases and business outcomes. AWS Solutions Library offerings include a mix of AWS purpose-built services and products, partner offerings and architectural guidance.

The science of simplicity

As AWS enters its 17th year on the IT scene, it continues to move beyond its original target market of cloud builders and developers with service development, as well as feature enhancement and cross-product integrations for other stakeholders such as line-of-business, compliance and procurement roles, as well data analytics, ML and artificial intelligence users.

As enterprises expand the volume of worlds on AWS, migrate more on-premises workloads to AWS, and create net-new applications on it, operations management, governance, security, billing and procurement will become more complex. Nearly two-thirds of organizations surveyed reported challenges in keeping up with public cloud providers' rapid pace of innovation and new service introduction. 451 Research's Cloud, Hosting & Managed Services surveys also show a correlation between the extent of public cloud adoption and IT environment complexity: 45% of organizations with current environments all or mostly in public clouds say their environment is highly complex, versus 27% of those whose IT is all or mostly on-premises.

To address this situation, AWS has ramped up its efforts around operational simplification and building integration between AWS services, particularly on the data analytics front. At the event, it unveiled zero-ETL (extract, transform, load) integration between Amazon Aurora and Amazon RedShift, bringing together transactional data and analytics capabilities (in preview).

Other steps in this arena include purpose-built data lakes and pre-built connectors to key data sources, which are elements of the omics, supply chain and security lake offerings. To simplify operations, the company introduced enhancements to AWS Control Tower (comprehensive governance/controls management) and AWS Cloud Trail Lake (integration with AWS Config and Audit Manage to create an immutable event store with a built-in compliance query engine).

AWS re:Invent 2022 also featured new capabilities for customers and partners on AWS Marketplace, including enhanced data visualization and analytics tools for sellers (in preview), deployment of third-party containerized software from the marketplace directly into customers' EKS clusters, and a streamlined vendor assessment process for buyers to validate the security posture of sellers on AWS Marketplace.

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^{This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.}