Apple spends more than $30M per month on Amazon Web Services

Apple is one of the biggest customers of Amazon Web Services, it has been revealed, with the iPhone maker allegedly spending in excess of $30 million per month in order to enable services like iCloud to function reliably and at scale via the retailer's network of servers.

Apple's popular and varied online services has made Apple a major client of Amazon Web Services (AWS), with its distributed collection of servers making it ideal infrastructure for Apple's cloud-based operations to use. While it has been known for some time Apple relies on Amazon, the terms of the relationship were largely unknown.

According to people familiar with the arrangement speaking to CNBC Apple spend more than $30 million per month on AWS in the first quarter of 2019. The figure apparently demonstrates a year-on-year increase of more than ten percent, and with Amazon's prices largely remaining static, suggest Apple's requirements are continuing to grow.

For the full year of 2019, it is tipped Apple will spend over $360 million with Amazon, up from approximately $350 million spent in 2018. The outlay is believed to make it one of Amazon's biggest clients, with a higher expenditure than Pinterest and Lyft.

It is likely that Amazon will continue to power Apple's online efforts for some time, as within the last few months, Apple reportedly signed a new agreement with the retailer, committing to spend at least $1.5 billion over a five-year period.

The $1.5 billion figure over five years, if accurate, is lower than Apple has spent per annum in the past. In 2016 and 2017, Apple was said to have spent $1.05 billion and $1.08 billion respectively for cloud support services from other vendors.

In 2017, an Amazon S3 outage caused problems for Apple. Some users of the iOS and Mac App Stores, iCloud Drive, Notes, iCloud backup, Apple TV, and Apple Music saw outages, induced by a configuration issue on Amazon's end.

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32 Comments

smaffei

said about 5 years ago

Who else thinks this a poor business decision on Apple's part?

I would rather see them align with Microsoft (Azure) than Amazon (AWS). I see Microsoft as less of a competitor than Amazon (in many spaces).

And, what are all those Apple owned server farms doing besides using solar panels? With all of that propaganda Apple pushes out, I would have never thought they are paying Amazon $30 million a month,

Soli

said about 5 years ago

smaffei said:

Who else thinks this a poor business decision on Apple's part?
I would rather see them align with Microsoft (Azure) than Amazon (AWS). I see Microsoft as less of a competitor than Amazon (in many spaces).

And, what are all those Apple owned server farms doing besides using solar panels? With all of that propaganda Apple pushes out, I would have never thought they are paying Amazon $30 million a month,

I don't see it as a bad decision in terms of competition, but I do wonder why Apple needs this at all with all their efforts made to build out massive data centers. I can see have backups for systems that aren't on your hardware design, but this feels more like Apple's own data centers aren't performing well. Can that really be the cause? I don't think that's likely so I think I'm missing some key details.

aaploutsider

said about 5 years ago

Soli said:

smaffei said:

Who else thinks this a poor business decision on Apple's part?
I would rather see them align with Microsoft (Azure) than Amazon (AWS). I see Microsoft as less of a competitor than Amazon (in many spaces).

And, what are all those Apple owned server farms doing besides using solar panels? With all of that propaganda Apple pushes out, I would have never thought they are paying Amazon $30 million a month,

I don't see it as a bad decision in terms of competition, but I do wonder why Apple needs this at all with all their efforts made to build out massive data centers. I can see have backups for systems that aren't on your hardware design, but this feels more like Apple's own data centers aren't performing well. Can that really be the cause? I don't think that's likely so I think I'm missing some key details.

A linked article in the above stated that they are guessing Apple will take 2+ years to abandon 3rd party cloud vendors in favor of their own.

auxio

said about 5 years ago

Soli said:

smaffei said:

Who else thinks this a poor business decision on Apple's part?
I would rather see them align with Microsoft (Azure) than Amazon (AWS). I see Microsoft as less of a competitor than Amazon (in many spaces).

And, what are all those Apple owned server farms doing besides using solar panels? With all of that propaganda Apple pushes out, I would have never thought they are paying Amazon $30 million a month,

I don't see it as a bad decision in terms of competition, but I do wonder why Apple needs this at all with all their efforts made to build out massive data centers. I can see have backups for systems that aren't on your hardware design, but this feels more like Apple's own data centers aren't performing well. Can that really be the cause? I don't think that's likely so I think I'm missing some key details.

Building your own data infrastructure, especially to the scale and reliability Apple needs for iCloud, is a huge undertaking. Amazon has a big lead in this area. My guess is that the data centers they have now are for their internal company data, which they wouldn't want to have in the hands of competitors. Eventually they'll have everything built out enough to use for iCloud.