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November 4, 2006
Amazon Web Services and Powerset in Business Week article
Rob Hof at Business Week just came out with an article called Jeff Bezos's Risky Bet. The article talks about Amazon's Web Services initiative, in which Amazon is enabling other companies to take advantage of the massive technology infrastructure Amazon has developed to power its own operations:
Amazon has spent 12 years and $2 billion perfecting many of the pieces behind its online store. By most accounts, those operations are now among the biggest and most reliable in the world. "All the kinds of things you need to build great Web-scale applications are already in the guts of Amazon," says Bezos. "The only difference is, we're now exposing the guts, making [them] available to others."
This article was the first to announce that Powerset is one of the major early customers for Amazon's new Electric Compute Cloud (EC2) Web service. Here are the relevant paragraphs, which mention Powerset and some of our key angel investors:
Consider Powerset, the secretive search startup backed by A-list angel investors, including PayPal Inc. (EBAY ) co-founder Peter Thiel and veteran tech analyst Esther Dyson. Co-founder and CEO Barney Pell harbors ambitions of out-Googling Google with technology that he says would let people use more natural language than terse keywords to do their searches. By analyzing the underlying meaning of search queries and documents on the Web, Powerset aims to produce much more relevant results than the current search king's.Problem is, Powerset's technology eats computing power like a child munches Halloween candy. The little 22-person company would have to spend more than $1 million on computer hardware, two-thirds of that just to handle occasional spikes in visitor traffic, plus a bunch of people to staff a massive data center and write software to run it. That's when Pell heard about Elastic Compute Cloud. He was sold. Based on tests so far, using the Amazon site for part of the company's computing power could cut its first-year capital costs alone by more than half.
... Highly anticipated search upstart Powerset Inc. plans to use the Amazon computing service, even though it's still in test mode, to supplement its own computers when it launches its service sometime next year.
I love the Halloween candy analogy -- it is both appropriate and timely (I've just eaten a bag of candy corn while composing this article).
Jeff Bezos will be talking about Web Services on Wednesday morning at the Web 2.0 Conference in San Francisco, and I expect he will be mentioning Powerset!
My Powerset Co-Founder and COO Steve Newcomb debuts his own blog column by giving his initial perspective on this partnership with Amazon and what it means for startups. Here is Steve's article on Amazon and Powerset. Steve has a more detailed article about EC2 that will come out later in the week, after Jeff's talk.
Posted by barney at November 4, 2006 2:57 PM
This entry was posted in the following categories: Ecommerce , Powerset , Search , Software , Web/Tech
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