How is cloud computing changing society?
Amazon technology boss Vogels: "For a lot of what is happening now, the cloud is in a certain way ideal"
Werner Vogels talks about how customer needs have changed in the pandemic. And how a corporation deals with it when the technology is far ahead of ethical concerns.
We conducted the interview with Werner Vogels via video chat. In doing so, however, the video function was switched off - because the bandwidth might not have been sufficient for good transmission quality. Because Vogels has been stuck in a rented apartment in Amsterdam since the outbreak of the pandemic. And so even the head of technology of one of the world's largest technology companies gets to feel the limits of the infrastructure in everyday life with a pandemic.
Vogels is the architect and father of Amazon's cloud business. Cloud computing is a key area of the digital economy: only fast, secure access to data allows it to be evaluated and thus the development of applications supported by artificial intelligence. With Microsoft and Google, Amazon are now on the heels of successful competitors. Born in the Netherlands and with a doctorate in computer science, he was promoted to chief technologist at the online retailer just one year after joining Amazon in Seattle in 2004. At that time, Amazon was faced with the challenge of storing the software programs and masses of data that customers left behind about their profiles, their purchases and also navigating the website in such a way that they could be found, easily read and thus analyzed.
First of all, storage and processing capacities were rented outside the company. Amazon later built up its own capacities and started renting them out. Today, the division supplies the tech giant with cash: Last year, Amazon Web Services (AWS) generated revenues of $ 35 billion, a 37% increase in operating profit of $ 9.2 billion compared to the previous year - and thus nearly two-thirds of Amazon's operating profit.
Mr Vogels, how did you get stranded in Amsterdam?
This year I wanted to focus more on customers in Europe and Africa. And so I rented an apartment in Amsterdam in order to travel from there - and not from the USA - to the customers. Two days after I moved in, the lockdown came. Since then I have been looking after my customers from my living room. To be completely honest, it's a lot more efficient than traveling a lot. I can meet twice as many customers a day as I used to. And we at Amazon and AWS have always been fairly decentralized, organized in small, independently working teams. It was much more difficult for hierarchically organized companies.
What problems have customers come up with since the outbreak of the pandemic?
There are two categories of customers: those who have become extremely popular as a result of the pandemic, such as the streaming service Netflix, the video conferencing provider Zoom or the communication tool Slack. We help these companies so that they can actually benefit from economies of scale and that their costs for the deployment and use of information technology rise much less than their revenues. And then there are companies whose sales have simply collapsed, such as in the hospitality industry, in aviation and actually in all services that have to do with customer contact. Let's take the tour operator TUI, which also has its own aircraft and hotels: the group has to drastically reduce its costs in view of the pandemic. The company has decided to migrate the majority of its IT to the cloud. This enabled it to cut its IT costs in half - and, above all, now that it no longer owns the systems itself but rents them from us, so to speak, it has control over the development of costs.
So cloud computing got a big boost from Corona?
For a lot of what's happening now, the cloud is in some ways ideal. In the UK, for example, comedians ran an evening fundraiser to help nurses. The action was limited to a few hours. Around 700,000 people have donated in this short period of time. To do this, you need an IT infrastructure that is resilient and above all that adapts quickly to demand. The days when cloud computing was about the use of storage space, databases and networks are long gone.
Do you have another example?
In Italy, a few students from the Politecnico di Milano have teamed up to develop a so-called crowd-sourcing app: anyone can use this app to enter how busy a grocery store is and how long the line is in front of the store. Before you go shopping, you can use the app to display the shops that are the least frequented and thus reduce the risk of being infected. In fact, millions of entries have been made in this app. That wasn't predictable. This app was only possible because the students were able to use storage and processing capacities via AWS - according to their respective needs.
AWS recently decided not to sell facial recognition software to the American police for the next twelve months. Are you concerned that Amazon's software is being misused - or that it is not working reliably?
Our moratorium on facial recognition has nothing to do with a lack of reliability in technology. But we think that society has to think about when which technologies can be used. And that can vary from country to country. Face recognition can be used for good causes. In the United States, for example, there is an organization that looks for missing children; she took the photos of these children and sent the facial recognition software through every nook and cranny of the internet, including the darkest corners.
Because of its size and power, Amazon has to increasingly prove that it meets ethical standards. How do you deal with that?
Take a look at London to see how much surveillance there is via video cameras. This has been the case for a long time and is fully accepted by society. Here in Amsterdam or Berlin that would not be an option; that would contradict the self-image of these cities. What ethics means differs from country to country, from region to region. It's up to us to educate government agencies and regulators about how our technology works, what we allow, and what it can do. Society must be clear about what can be done with a technology. I am firmly against this decision being made by individual companies. That has to be decided socially. We have to make sure that everyone knows exactly what the technology can do and where its limits are.
However, society's demands on companies are higher: it wants Amazon to make a value judgment before a technology is unleashed on it.
Correct. In the end, it is important that we explain transparently how something works. We want the public to have all the information they need. And we talk to government agencies to define what is tolerable and what is not.
Where will cloud computing be essential in the future?
Customer service is a good example. In the future, nobody will be sitting in a large, central call center answering customer inquiries. We have developed a solution that allows decentralized customer service from home. We are seeing that more and more companies and government agencies need decentralized customer service, which is causing the demand for such collaboration tools to explode. But what cloud computing has done in recent years is that it gives everyone the same opportunities - regardless of whether it is a small startup or a global corporation. Everyone tries to make better use of the available data and to take advantage of it or to make better decisions.
Are the companies more willing to get involved in new things because of the corona pandemic?
The companies tell us that their customers are currently driven by great fears, worried about their health and their jobs. The past few months have shown that the situation can change in one fell swoop. This has an impact on which products and services you offer your customers. A small bank has to adapt quickly to the emotional needs of its customers. In Great Britain, a small team developed an app in a week, Corona Friends, which you could use to find someone in the neighborhood to do the shopping for you. These seem to be mundane applications. But they have to be done. And in an emotionally skillful way. The focus is now on the customer's situation - less the question of how I can present a product to them.
If everything is to run virtually and independently of location in the future, there will no longer be any need for fixed workplaces. Then what happens to the huge office buildings that Amazon has built?
This is one of the sensitive issues that we as a company have to solve so that we have enough space in all of our locations.
According to Amazon CEO Jeff Bezos, Covid-19 is the worst crisis the company has experienced in its 25-year history. Do you agree?
I remember the turn of the millennium when the dot-com bubble burst. Back then, the media called us “Amazon Dot Toast”. The share price was at the bottom. Of course we see Covid-19 as a crisis. But in the sense that we have to speed up everything we are going to do.
When will you travel around the world and visit customers again?
Maybe never, who knows. I am struggling to predict that. I have dealt with venture capital issues, visited and supported start-up companies that develop solutions for really big issues. I can't do that in the same way right now. It takes a lot of creativity to find new ways. The new normal will not be that we go back to the starting position. When I see what's going on in the US and Africa, I have to assume that the crisis will keep us busy for a long time to come. It's like evolution: not the strongest, but the most adaptable will survive.
Does the technical infrastructure even meet the demands of the brave new world?
That will evolve over time. When I rented my apartment in Amsterdam, I didn't expect to work from here for weeks. The existing 25 megabit line is actually not suitable for what I'm doing. Installing a 100 megabit connection in Amsterdam takes two months because everyone here wants that. The infrastructure will improve because access to digital systems requires a robust IT infrastructure that works and has sufficient transmission capacity.
Do you expect that there will be a superbug in computer science at some point? A digital virus that has no prescription?
I am confident that we can control such a virus rather than one that flies through the air uncontrollably.
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