[discodave]

An underestimated chunk of AWSs costs is people. They employ >50k people, and likely have a salary bill of several billion dollars, a significant portion of revenue.

50,000 x 250k = 12.5B

Also, they do cross-subsidize, because many AWS services are either hardly used (CodePipeline) or free (CloudFormation) and the cost to run those services is non-negligible.

[throwaway2016a]

Very good point RE people. Running AWS is expensive, I'm sure, but to be clear, I'm not advocating for bandwidth to be free. Just that $0.08 per GB is not competitive.

Also, since CloudFormation is a feature that facilitates creating more resources that you do pay for I'm not sure that is a great example. That is more like saying that the other services subsidize the Web Console. CloudFormation is not a product in-and-of itself, it is more a shared feature that spans product lines.

Code Pipeline is an interesting one in that if it is true it's not widely used and costs more money than it makes, that's a no brainer: shut it down. But there has got to be more to that story why they haven't.

But in any case, with code pipeline there is a clear value chain that ends at ECR/EC2/Lambda/etc. My guess -- and it is just a guess -- would be that someone feels pipeline produces more revenue for EC2 (or similar) and that covers the cost. Or, simply, they have a path for it to be profitable.

[discodave]

You're overthinking it, and Code Pipeline is just one example. As I'm writing this they have close to 300 services!!! Many of them, maybe hundreds of them just straight up lose money.

The Corey Quinn number I keep quoting is that >60% of AWS revenue for large (>100MM) accounts is EC2. That jives with what I hear from people in the industry.

That means that the other 250+ services are splitting less than 40% of AWS revenue....