Why must Amazon pass off its savings to your org, in this example, rather than taking most of those realized R&D savings to their own investors?
Sure, AWS may be constantly innovating on doing things more cheaply and scalably. Sometimes, those savings get passed off to the customer; but not most of it, and not necessarily all that frequently.
Amazon competes with other cloud providers and with build-your-own continually, and use price segmentation to stay on the right side of the equation for as many people as possible, while still skimming as much premium for themselves from each user group. Historically, that’s meant big price drops in most categories that would make most one off investments obsolete - while still keeping a ton for themselves.
It also helps that S3 is an anchor product that helps them sell higher margin stuff.
I was at an F500 that spent a lot of money with AWS. I heard rumors that services were becoming more expensive. If you are spending a ton of money, moving off of AWS is major project that will require a lot time, money, and personal. You are kind of locked into AWS unless you convince senior management you should move off.
Yes but no. The figure you reference shows the lowest price of a lowers tier available. I am pretty sure if you cannot switch from S3 with full availability to S3 Glacier, your savings will not be SO impressive as that fall-off-the-cliff figure.
The figure shows full-availability S3 at multiple price tiers depending on volume. The article discusses that price reductions were biggest for high volume -- in other words, AWS reduced price for exactly the customers who are most equipped to build-not-buy. Smaller use-cases won't see prices go down as much -- but they also won't get paid back as quickly for rolling their own.
Did you miss where AWS reduces prices multiple times a year? I don't know the latest figure, but as of 2018, they reduced prices 67 times since launch in 2006.
Sure, AWS may be constantly innovating on doing things more cheaply and scalably. Sometimes, those savings get passed off to the customer; but not most of it, and not necessarily all that frequently.