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7 pages/≈1925 words
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Business & Marketing
Case Study
English (U.K.)
MS Word
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Amazon’s New Store: Utility Computing. (Case Study Sample)

Case Study Amazon’s New Store: Utility Computing. Chapter 5, Page 230, Answer all questions. (ATTACHED) Management Information Systems. Laudon and Laudon. source..
AMAZON’S NEW STORE: UTILITY COMPUTING Name: Grade Course: Tutor’s Name: (07, October, 2010) Amazon’s New Store: Utility Computing Question 1 Amazon provides data storage services and provides computing tasks for its clients through the use of the Amazon’s servers. Amazon joined the cloud computing service provision through Amazon’s Simple Storage Service (S3) which offers data storage services and Elastic Compute Cloud (EC2) whereby the clients make use of Amazon’s servers. Amazon charges 15 cents per gigabyte for the data that is stored through the S3 services and 20 cents for any data that has been transferred. ES3 is used for businesses to back up their data. EC2 allows businesses to use Amazon’s servers for computing tasks such as software testing. Amazon charges are fair as they charge 10 cents for each instance-hour consumed and 20 cents per gigabyte traffic inbound and outbound (Laundon & Laundon, 2009). On top of this there are charges on storage using S3 services at the S3 service rates which are charged for storing Amazon Machine Image (AMI). AMI includes applications, libraries, data and configuration guidelines for the clients and which they use in running the processes. Advantages to Amazon The provision of the technology services is beneficial to Amazon as there are profits to be earned from them. The idea originated from the realisation that Amazon utilised a small percentage of the computing capacity, in addition to a strong and reliable information technology (IT) infrastructure. From this realisation, Amazon decided to open the system to the internet users and charging according to usage. The company is earning extra profits from the system that had already been created. Advantages to the clients The S3 system is a fast simple and affordable option for a business to store data. The availability is at 99.9 percent, thus making it reliable, dependable and scalable. The service does not require client software and no set up of extra hardware. This makes it convenient as the client will not need to worry about obsolescence of both the hardware and software. The client can conveniently store backup data using this service. The service enables businesses to use the already developed Amazon technology avoiding the mistakes Amazon made in the learning process. Creating a webscale would mean high investments in terms of money and time. The webscale development would take sometime trial period to develop to satisfaction. This would involve several corrections and adjustments of the systems. Using Amazon’s Web services has the advantage of using an already developed system which is easier and simpler to use than creating own webscale. Using Amazon’s web services will reduce salary costs for the business. The services are simple to use and anyone with basic computer knowledge can use them. It is therefore not necessary to employ network and system administrators. This is a saving to the business. Since the services do not need any additional hardware, the services are convenient because the business does not need to worry about replacing obsolete hardware or outdated software systems. There are a lot of other savings on cash expenditure and reduced risks had the business opted to develop its own web service and IT infrastructure. Amazon does not have a minimum fee charge or a start-up charge. To use the services one is only required to pay per usage. This means that the business will only pay for what it is using. The bigger the storage needs the higher the pay and the reverse is also true. This means that the business needs will be catered for without the need to plan or budget for the unpredictable growth of the business. Challenges The S3 and EC2 web services are an innovative idea by Amazon. However there is the possibility that big companies may join in the competition and offer...
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