Amazon’s Zocalo Cloud Service Casts a Shadow over Startups

File-synchronization and collaboration service Amazon, Zocalo, a great player adds to an already saturated market.

In the 1990s, Microsoft became identified with the Death Star in part to attract developers to build applications (such as WordPerfect and Lotus 1-2-3) on its platform and then launch copycat versions running smoothly thanks to exclusive access to the underlying code. Now it's time for Amazon to try on the helmet of Darth Vader.

Amazon is launching socket, a service that allows people to store and synchronize files and built in S3, own cloud storage-as-a-service infrastructure of the old bookseller. Zócalo (Spanish for "base" or "town square") is aimed at businesses and has preferred features for IT managers, such as encrypted connections and controls of fine-grained access. No doubt, people realized Dropbox; service, which offers similar features increasingly tailored to corporate clients, is one of the most visible successes of S3.

Bells more loud alarm may be ringing in the arch competitor of Dropbox, Box. While Dropbox built his business serving consumers and only recently moved to the companies, the case has focused on the market for the company almost since its founding in 2005 (see "Continuous Productivity Aaron Levie"). It has blue-chip clients such as General Electric, Procter & Gamble, and Schneider Electric, but faces competition from EMC Syncplicity blisters and Citrix ShareFile and OneDrive Microsoft, Google Drive, and a host of others. The last thing you need is another big pockets opponent gunning for the Fortune 500.

"An immediate threat to see Amazon come into our business Feels" admits Chris Yeh, senior vice president of product box and platform. "But there is more nuanced than it seems on the surface. There is nothing easy in this business."

In fact, it has been a difficult year for the box. The company filed for an initial public offering in late January, raising expectations of a deal as early as April. In March, however, the company announced that, despite extraordinarily rapid growth of revenues, costs far exceeded revenues ($ 168 million out $ 124 million in the year ended January 31, 2014) . The stock market started the same time as British companies in cloud software, leading to reports that the box could postpone its initial public offering. Safety issued a statement that was proceeding as planned, however, without setting a date-and late June accepted a $ 150 million, making it one of only a handful of companies in recent years has privately raised funds after filing to go public. The cash injection track the company extends for another year at least buy time to join the most prestigious customers, increase revenue and reduce expenses. Safety has not yet set a date of IPO.

Extraordinary burning rate case reflects the brutal economics of storage-as-a-service. The price of hard disk capacity per megabyte fell from $ 700 in 1981 to two-tenths of a cent in 2010 The cloud offers a plethora of free options. Mega 50 gigabytes in a terabyte on Flickr. This week, in fact, will offer Box announcedthat unlimited storage for customers of your business products. Companies are expected to grow but to add value to documents stored. That pressure has driven Microsoft, Google, Amazon and now evolving to provide a generic file storage for specialized services for large organizations that have real and real money to spend on solving problems. It has also led to a price war that so far has seen prices drop by Google and Microsoft to boost storage allocations by customer. Safety, meanwhile, can not afford to be drawn into a race to the bottom. It must continue to move up the value chain, while becoming indispensable to customers and discreetly making it difficult for them to switch to a cloud provider storage opponents.

CEO Aaron Levie outlined the basic features that businesses require a storage service in the cloud from the beginning. In the past year, the box has been implementing a broad view of international collaboration frictionless. Provides a programming interface for integration of custom and third-party code, metadata tagging to keep documents organized files and previews file high fidelity to easily identify specific documents without opening them. At the same time, he has focused on serving vertical markets. For the healthcare industry, which meets the medical privacy laws. For legal and financial clients, which is integrated with electronic signature services. The company has built farms in Europe, Asia, and South America to meet local regulations and provide an interactive experience for international customers and deal with local regulations. Levie is betting that competitors can not offer the depth of service anytime soon.

 

But Zocalo may not need. Given that Amazon Web Services has become the go-to source of computing power to the new race online business, the company may also threaten Google, Microsoft, Salesforce and stronger, connecting customers in increasing basic services such as e-mail management, customer relationship management and enterprise resource variety, all sharing Zocalo as a basic resource.