Amazon’s Seeing Red: How Redshift Will Change Cloud-Based Services

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Amazon has been making a lot of moves in the past year with their IT services. The company made an announcement last week that it would take its cloud-based data warehousing service Redshift to a whole new level. Redshift is now publicly available, a major shift from its limited use launched in November 2012. Redshift is a part of Amazon Web Services, which has been Amazon’s way of cultivating a large start-up and online business following. Customers can store data for their services, but it’s also a way for bigger companies to cut operational costs, too.

A lot of people are interested in this new change, including some big names like IBM, Informatica, Tableau, Actuate, Pentaho, SAP, Cognizant, Roambi and Pervasive. These companies are hooking up with Redshift to create more IT services while also offering analytics. Amazon is still retaining its beginning partners: MicroStrategy and Jaspersoft.

As Amazon makes its new moves, these big names are going to come in handy. Businesses definitely need a new cloud-based option to go with their ever-expanding data and technology usage. It’s also becoming an integral part of business processes around the world.

So how much does it cost? Amazon is only offering the service with a sliding scale pay model which is based off of usage. Pricing will be an on-demand, 2 terabyte storage, XL node starting at $0.85 per hour per node with a one year contract for the same service that will cost $0.215. There is another tier for those who need quite a bit more storage which is the 8XL Node, 16 terabyte storage priced at $0.912 for a three-year, reserved instance at $6.80 per node as an on-demand choice. All of that can basically be summed up to a terabyte of data coming in at a little under $1,000.

For those who have always physically stored their data using traditional warehouse management systems, that is a considerable savings. Andy Jassy, the SVP and president of AWS said last year that the typical cost equal to a data warehousing solution was around $20,000 to $25,000 per terabyte.

Raju Gulabani, VP of database services at AWS stated that Amazon Redshift was a way to deliver more performance at a fraction of the cost, allowing for better efficiency, and security while also giving more storage options. Amazon has always offered somewhat unbeatable prices for cloud-based storage, and this is no different. In addition to Redshift, Amazon launched an elastic video transcoding service at the end of January that also reformats videos into different media types.

While there aren’t too many predictions yet by Amazon how well Redshift will do, it’s a familiar sales tactic that Amazon has used in the past. For example, sales figures on Kindles remain a well kept secret by Amazon. However, it made sure to recognize the hundreds of companies that made the change to Redshift since November. These companies also span across diverse industries like gaming, mobile, advertising, manufacturing, healthcare, e-commerce and financial services.

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