Economies of Scale
- Definition
- AWS aggregates the demand of millions of customers, buys hardware and power at enormous volume, and passes the lower unit cost on.
- Stated in the AWS value proposition as “massive economies of scale” — you pay less than you could achieve on your own.
- Evidence
- Repeated price reductions since 2006 with no negotiation required.
- Volume tiering: the more Amazon S3 you store or data you transfer, the lower the per-unit rate.
- consolidated billing in AWS Organizations pools usage across accounts so the whole organization reaches higher discount tiers.
- Related benefits in the same list
- Trade fixed costs for variable costs.
- Stop guessing capacity.
- Increase speed and Agility.
- Stop spending money running and maintaining data centers.
- Go global in minutes.