As we close out the year, iTNews Asia speaks to Phil Davis, Managing Director, APJ, Amazon Web Services, to find out how the company is enhancing the agility for companies in their digital transformation, walking the talk on global sustainability and helping the industry grow in the softer aspects of tech skills development and ensuring diversity and inclusion.
Looking into 2022, Davis also shares his perspective on how customer needs are evolving, what the cloud landscape will look like and what AWS is doing to bolster its cloud leadership in the region.
iTNews Asia: How fast is cloud adoption growing? What are some of interesting examples of how your customers are using the cloud in their tech innovation?
Globally, our business is growing at 36% globally year-on-year. We’re continuing to see that accelerate and this is a reflection of more customers moving to the cloud for their digital transformation and they’re doing so at a faster rate.
In Singapore, DBS is working with us on the concept of AWS’ DeepRacer. They’re trying to gamify AI and machine learning, training 3,000 employees and providing them with hands-on experience to build and simulate a racecar using AI and machine learning models.
Domino’s is working with AWS to reduce pizza making and delivery times using predictive ordering. Domino's wanted the time to deliver a pizza to customers to be within 10 minutes – starting from the order to the making of the pizza and to the delivery. They are using AI to predict when customers will want a pizza even before they order.
What we’re seeing is that every business is going to be a digital business. Banks have been on digital transformation journeys for years now, and SMEs and mid-size enterprises are doing so now. You're going to see the pace of digital transformation accelerate.
iTNews Asia: In their ongoing digital transformation, what do you see as a challenge your customers still face?
The question of ‘How do I better make use of data?” is going to be even more important for our customers. We're already seeing that happening and over the last three years our customers have done a better job getting data and consolidating them. But they still are struggling to get insights from the data.
iTNews Asia: Leveraging technology (and the cloud) is now an imperative for many businesses. What’s changed is that IT is now accepted as fundamental to their business transformation goals. How critical is embracing tech a factor in defining the leaders and those who fall behind?
Increasingly the customer experience will be the differentiator for the business. Unlike 10 to 15 years ago, companies must be able to serve customers who are now digitally savvy. They're interacting with a company from their smartphone or a digital application, and not through physical. If you're not enabling that experience, you’ll be competing against others who are, and you're going to be at a competitive disadvantage.
If you take the example of Domino's, if you’re going to need 25 minutes to deliver the order and Domino's only takes 10 minutes, where are people going to buy the pizza from?
Companies with better insights will be able to provide a better customer experience. Those who do so will have an advantage - whether it's from better time to delivery, a better cost structure or a better digital experience.
The customer experience will be the differentiator for the business. Unlike 10 to 15 years ago, companies must be able to serve customers who are now digitally savvy. They're interacting with a company from their smartphone or a digital application, and not through physical. If you're not enabling that experience, you’ll be competing against others who are and you're going to be at a competitive disadvantage.
- Phil Davis, Managing Director, APJ, Amazon Web Services
iTNews Asia: Businesses understand the cloud can be a transformational tool. However, research has found that the transformation can be difficult and is easier said than done. A recent Deloitte APAC report in July this year showed that about 30% of businesses in the region are unprepared for the cloud and about 15% have no clue how to start.
One of the key trends driving the industry that AWS identified is (the shortage of) cloud skills. In research we commissioned, we found that the need for advanced cloud computing and data skills in APJ is growing 36% per year and this shortage will triple by 2025
Many customers said they don't know how to do it or don't have the resources. We can help train and certify them with our training and certification programmes. As an example, a lot of Qantas employees were impacted by COVID when they dropped their flights by 80%. We worked with the airline to re-train their employees with digital and cloud skills. We started a ‘crew in the cloud’ training and certification programme to enable them to be cloud fluent.
This is an area where we can help the industry. AWS has since trained 9 million people, including 2.5 million here in in Asia Pacific in Japan. Globally, we've committed to training 29 million people by 2025. We’re also working to bring more free training to markets to enable more people to participate in the digital economy.
Secondly, we’re also investing heavily in our partner network across ASEAN and the Asia Pacific. We now have over 100,000 partners globally.
We have a lot of different capabilities – whether it's formal training certification, our partner network, or some of our own methodologies and architecture we’ve built as well as best practices from our work with customers.
iTNews Asia: In some of developing countries here, such as Indonesia or India, the biggest issue is connectivity, not transformation. How do you see the markets evolving there?
There are certainly areas where connectivity is still a challenge. They will be solved increasingly and accelerate further when 5G becomes available. 5G will give you a lot more spectrum bandwidth and you can split the spectrum and dedicate latency. There are now all sorts of different use cases where 5G is taking place, from autonomous vehicles to gaming.
When you talk about connectivity, AWS’ cloud now spans 26 regions globally and in APAC we’re continuing to expand our cloud infrastructure throughout Asia Pacific. We’re adding another regional site in Hyderabad in India, we have launched in Indonesia and are launching in New Zealand and setting up another in Australia. We’re adding more locations and increasing our presence so that we can get better latency.
When you’re closer in proximity, you can do all the processing locally and better solve problems. We're working with all major telcos across the APAC region and doing more to bring our infrastructure as close to our customers as possible.
iTNews Asia: How do you see your customers transforming? What has been their approach to moving their technology stacks to the cloud?
We’ve customers who’re builders and customers who’re buyers. A lot of the larger organisations are moving towards being a buyer – they want to get a solution out of the box and to get the value as quickly to market as possible. Larger enterprises and smaller businesses are likely to be more buyers
The digital Natives and ISVs are more builders. They want to build their own customer experience and develop their own application. Digital natives and ISVs tend to want to build their own superfast F1 race cars from the ground up.
We’re seeing both types of customers moving to the cloud.
iTNews Asia: Many organisations see the hybrid cloud as a practical route in their cloud migration. Some also are planning to use multiple clouds so they’re not beholden to one provider and can have more flexibility. Is that what you’re seeing from the ground?
The point of hybrid is that it will take time. People are still using mainframes and they’re not exactly the newest technology. Eventually it will all be in the cloud but it’s not going to happen overnight. The transition will take time.
As an analogy, think about the second industrial revolution. Companies used to build all their own electricity and power plants. Today nobody builds their own power plants, they just plug into a power grid.
It’s the same with IT. They used to spend tens or hundreds of millions of dollars doing all their own IT but we can do it better, faster, cheaper and be more power efficient. One of the initiatives we announced recently at AWS re:Invent was that we are accelerating the migration of legacy workloads from mainframes into the cloud.
We see challenges in a multi cloud. As we discussed, one of the issues over the next few years will be the limitation of skills. It’s difficult enough on one cloud. How are companies going to manage several clouds? That's a real challenge that they need to think about when considering their cloud strategy. They also need to think if they will get a better economic deal using three, or four or five different providers? I'm not certain that they will get the value and outcome that they want.
iTNews Asia: The playing field you’re in is getting crowded. I see a lot of your competitors starting their own cloud regions too, bringing their data centres and working with developers and communities here. How do you view the competition?
(Our legacy) goes back to Jeff's founding of the company and wanting to be the most customer-obsessed company. We spend a lot more of our time and energy worrying about our customer needs than the competition.
I think a big differentiator for AWS is the culture of the company, and an advantage that we can sustain.
iTNews Asia: It’s good to see that AWS is planning to power all its operations with renewable energy by 2025. How important is sustainability for AWS and for your customers in Asia?
Sustainability has become much more important for our Asia Pacific customers than it was two or three years ago.
We’re a large organisation and we recognise that what we do impacts the world. Our track record (in sustainability) speaks for itself. AWS has co-founded the Climate Pledge to completely cut carbon emissions by 2040, 10 years ahead of the Paris agreement. We have made five renewable investments across projects in Australia, Singapore and Japan and they will contribute more than 500 MW of installed capacity and will supply more than 950,000 MWh of additional renewable energy to local electricity grids.
Our data centres are also going to be about 3.6 times more energy efficient than a typical corporate data centre.
There’s also a lot we can do with local communities here. For example, in the area of food sustainability, Indonesia’s Sayurbox, a fresh produce platform, is using AWS to manage the supply chain of their food from farm to table. They’re using machine learning in their operations and warehouse management systems to assess demand levels and match them to supply. By being able to forecast demand, farmers in the country can sell their goods at a higher price with a confirmed quantity.
iTNews Asia: A lot of companies went online and remote during the pandemic, often out of necessity. I see 2022 as year where their network infrastructures continue to mature and become more secure and robust. How important are security and resiliency for the customers you’re working with?
We regularly sit with our customers to review their architecture to ensure they use the best practices and get the certification and training. This also extends to our large global SIs all the way to the local partners.
Security is our number one priority. Regulated industries –such as government, financial services and telcos – tend to be the most sensitive to security and we work with them on best practices around encryption and securing their data.
Resiliency has always been important. Our uptime is among the best in the industry and this is due to the way our regions are architected. We’ve local availability zones inside a country to provide the resiliency needed. Our customers, wherever they are, have the isolation and resiliency to run their workloads across multiple regions.
iTNews Asia: What are the trends that will drive your focus in APAC in the next 12 to 18 months?
A lot of what we announced at re:Invent was on how AWS can help accelerate the digital transformation for our customers around three areas: sustainability, getting better insights out of your data, and digital transformation at the application level for businesses.
Sustainability, both local and on a large scale, will continue to be important for next year, as well as enabling digital skills. We’re also investing even more in inclusion, diversity, and equity. In Australia, we’ve started a programme called SheDares, a free, online, interactive learning program to encourage and help women who aren't in tech to get ready to start a career in STEM.
We plan to focus deeper on our capabilities and drive innovation for our customers at a faster pace than ever before.