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From the technology perspective, the top three players, particularly AWS, still had the edge over Alibaba in terms of breadth and diversity of offering. The cloud is synergistic, so while Google seemed comparatively constrained, Microsoft and Alibaba continued to drive incremental sales on top of existing products and services.

5. Enabling Digital Entrepreneurship on the Cloud

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Cloud service providers played an important role in levelling the playing field, allowing organizations of all sizes to embrace digital transformation and new business models to compete in the fast-evolving technology landscape. With innovation a key determinant of success in the digital age, the cloud opened the field to digital entrepreneurs seeking to test their ideas efficiently and cost-effectively. In addition to providing cloud computing services to large corporations and SMEs, it gave anyone with a great idea the tools to innovate, grow, and compete with bigger players. Enabling unprecedented speed and agility, it let start-ups experiment initially and scale up quickly when necessary.

When digital-innovation apps take off in a phenomenal fashion, the infrastructure is often unable to keep pace with demand and the company may fail as a result. The shift from office-based work to working on-the-move had created huge demand for cloud-based technology and big data requirements – companies relied on data to serve consumers, mining their habits, spending patterns, whereabouts etc. Cloud data centres enabled instant adjustment to internet traffic volume and data requirements, as witnessed on Alibaba’s Singles Day operations.

By transitioning functions to the cloud, companies could focus on their core business. In addition to various apps, storage, email and database servers, the cloud offered servers for gaming and mobile apps. The benefits of rapid scalability and elasticity, which enabled systems to grow in step with changing business demands while minimizing costs, were particularly strong for companies specialised in digital innovation. Anyone (from entrepreneurs to large MNCs) could leverage cloud technology to execute strategies in emerging technologies like AI, IoT, cognitive computing and Machine Learning (ML). In a way, the cloud players had democratized these technologies – accessible to everyone. Each had a similar strategy of opening their cloud offerings to partners to encourage the formation of a genuine ecosystem. Most partners were small vendors, although SAP was notable in Google’s ecosystem. Customers could use the software and services in a plug-and-play way (see Figure 6).

For the exclusive use of J. Li, 2022.

This document is authorized for use only by Jia ye Li in MIS 441 – Global E-Commerce-1 taught by Richard Johnson, Washington State University from Jan 2022 to Jun 2022.

 

 

 

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Figure 6: Ecosystems Offered by Top Cloud Players

Source: https://www.visualcapitalist.com/interactive-major-tech-acquisitions/

Cloud computing technology enabled companies in developing countries such as Indonesia and Nigeria to “leapfrog” over earlier technologies and compete with bigger companies locally – and in some cases globally. Unlike the past, when the initial investment in hardware and software was expensive and rigid, start-ups and midsize organizations could leverage cloud computing to spur innovation and compete, because they had access to the same technologies as much larger organizations without the burden of investment in expensive data centre resources and highly skilled IT personnel.

Cloud computing also enabled a mobile app revolution. Unlike native apps, developed specifically for iOS or Android, cloud apps could be launched on both platforms at the same time, thus lowering development and maintenance costs. Cloud apps did not have to be downloaded and installed on mobile device. Data stored on the cloud was more secure.

New digital mobile businesses in all industries were using cloud computing to support new business models. Prominent examples in Southeast Asia included Go-Jek in transportation, Circles.Life in telecommunications, and Shopee in retailing. Cloud computing had been instrumental in the rapid scaling up of global media companies with worldwide scale, such as Netflix and Spotify.

Given the value of cloud computing for business, innovation and society, prominent providers will compete fiercely for a share of this fast-growing market, which is truly global in scale. Perhaps the global cloud wars are only just beginning.

For the exclusive use of J. Li, 2022.

This document is authorized for use only by Jia ye Li in MIS 441 – Global E-Commerce-1 taught by Richard Johnson, Washington State University from Jan 2022 to Jun 2022.

 

 

 

Copyright © INSEAD 11

Preparation Questions

The following questions may be useful to prepare for class discussion:

1. How do the four companies’ cloud business strategies differ from each other? 2. Who do you think will be the cloud winner of the battle for worldwide market share in 2025?

Who will be the winner in Southeast Asia? Why? 3. If you could invest $1 million in each company’s cloud business (only), how would you

allocate your investment? Why? 4. What are the potential synergies between the cloud business with each company’s non-

cloud businesses? How do they differ?

 

For the exclusive use of J. Li, 2022.

This document is authorized for use only by Jia ye Li in MIS 441 – Global E-Commerce-1 taught by Richard Johnson, Washington State University from Jan 2022 to Jun 2022.

 

  • Source: https://www.visualcapitalist.com/a-visual-history-of-the-largest-companies-by-market-cap-1999-today/

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