Andy Jassy, Amazon AWS
Source: CNBC
Andy Jassy has transformed Amazon from an e-commerce giant into a highly profitable tech company over the past 15 years, creating and then dominating the cloud infrastructure market.
Now he is in the spotlight as CEO of the third most important US company after Apple and Microsoft. Amazon said Tuesday that Jassy will succeed Jeff Bezos at the helm in the third quarter and become the second CEO in the company’s 27-year history.
Jassy, 53, is a member of Bezos’ elite leadership group, the S-Team. While he’s headed AWS since its inception, Bezos named him AWS CEO in 2016. In September, a Washington Post column owned by Bezos named Jassy the “clear heir” of Bezos.
Jassy graduated from Harvard University in 1990 and Harvard Business School in 1997. Then he went straight to Amazon and never left. In an interview last fall, he said he and his wife had agreed that they would move to the west coast to be closer to their family for a few years and then move back to New York. “That was of course 23 years ago and the statute of limitations has probably expired,” he quipped.
Amazon paid Jassy $ 348,809 in total in 2019, compared to $ 19.7 million in 2018 when it received over $ 19 million in stock awards, according to the company’s latest proxy statement. He owns approximately 85,000 shares valued at $ 287.3 million as of Tuesday’s close of trading. Last year he reduced his holdings from just over 100,000 shares.
Crucial to Jassy’s success has been his ability to attract all types of companies and organizations to AWS products and to provide services to the smallest startups and the world’s largest companies like Apple. Along the way, he won deals from the Central Intelligence Agency and the Democratic National Committee. More AWS contracts have been released in recent years as companies like Pinterest, Slack, Lyft, and Snowflake held their IPOs and had to disclose their high cloud spending.
When AWS began its services rollout in 2006, the focus was on providing cloud storage and compute capacity, primarily for smaller technology companies and development teams. As these companies grew up, many never bought their own servers or storage arrays, relying on Amazon for all of their data center needs. By the time Microsoft took Azure seriously and Google started investing heavily in its cloud platform, Jassy had built an insurmountable lead.
As of mid-2020, Amazon controlled 33% of the global market for cloud infrastructure services, according to Synergy Research, followed by Microsoft with 18% and Google with 9%. Amazon announced Tuesday that AWS revenue grew 28% to $ 12.7 billion in the fourth quarter. Operating income rose 37% to $ 3.56 billion, representing 52% of Amazon’s total operating profit.
In recent years, AWS has grown well beyond core computing and storage, offering a variety of services in addition to its infrastructure, including databases, analytics tools, content delivery, and machine learning software. That has made Amazon a highly competitive rival for big companies like Oracle and emerging cloud players like Snowflake, who pay Amazon a ton of money every year.
In 2017, Jassy suggested Oracle for what he called the company’s practice of keeping customers on painfully long and costly contracts.
“Given the experience they have had over the past 10 to 15 years, people are very sensitive to being locked up,” Jassy said at Amazon’s AWS Summit in San Francisco. “If you look at the cloud, it’s no different than being tied to Oracle.”
Amazon’s annual Reinvent conference in Las Vegas began in 2012, although the last one was virtual due to the coronavirus pandemic. It has become a focal point for executives and venture capitalists. Jassy is known for extravagant keynotes, including when he brought an 18-wheel truck called Snowmobile onto the stage in 2016 to demonstrate how AWS can move data from a company’s data center to an Amazon facility.
Jassy will take on the role of CEO later this year when Bezos moves to executive chairman, Amazon said. The announcement comes less than six months after Jeff Wilke, CEO of Amazon’s global consumer business and widely regarded as Bezos’ top successor, announced his resignation.
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