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What is AWS? Amazon Web Services Ultimate Guide

Last updated on
February 21, 2024


AWS in a nutshell

AWS offers a broad set of global cloud-based products, including compute, storage, databases, analytics, networking, mobile, developer tools, management tools, IoT, security, and enterprise applications.

The main functions of Amazon Web Services (AWS) include:

  1. Computing power: Providing scalable computing capacity (e.g., Amazon EC2, AWS Lambda).
  2. Storage solutions: Offering secure cloud storage (e.g., Amazon S3, Amazon EBS).
  3. Database management: Managed database services (e.g., Amazon RDS, Amazon DynamoDB).
  4. Networking: Creating isolated networks in the cloud (e.g., Amazon VPC).
  5. Security and identity: Tools to manage access and encryption (e.g., AWS IAM).
  6. Migration and transfer services: Tools to assist in migrating applications, data, and workloads to AWS.


What is AWS? Amazon Web Services Ultimate Guide


AWS's versatility in offering these wide-ranging services is what makes it a powerful tool for businesses and organizations of all sizes, from startups to enterprises and public sector entities.

Learn how AWS supports businesses and which features are the most useful.

What is AWS?

Amazon Web Services (or AWS) is a comprehensive cloud platform by e-commerce giant Amazon. It provides Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS) and Infrastructure-as-a-Service (IaaS) offerings. To understand the logic of AWS, think about the evolution of electricity supply.

Initially, factories would build their own plants to power their facilities. Over time, governments and private investors constructed large power plants that would supply electricity to multiple cities, factories and homes. With this new model, factories would pay much less per unit of power thanks to the economies of scale the huge electricity plants enjoyed. AWS was conceived and has grown based on similar logic.

By 2006, Amazon had positioned itself as the world’s leading online retailer, a place it still holds to date. Seamlessly running such a massive operation required extensive and sophisticated infrastructure. This imbued Amazon with deep knowledge in the management of large scale network and server systems.

AWS was therefore launched in 2006 as Amazon sought to make available to businesses and individuals the technology infrastructure it had built and the knowledge it had acquired. AWS was one of the earliest pay-as-you-go (PAYG) computing models that could scale throughput, storage and compute based on the customer’s changing needs.

Amazon Web Services provides cloud services from tens of data centers and multiple availability zones (AZs) spread across regions of the world. Each AZ contains multiple data centers. Customers can setup virtual machines and replicate their data in multiple AZs in order to have a highly resilient system that’s resistant to a server or data center failure.

Learn more about Amazon Web Services.

In total, AWS comprises over 100 distinct services. Before you sign up for any of them, it would be best to work with a digital transformation consultancy to ensure you subscribe to a service that’s a good match for your business needs. We cover the major AWS product categories below.

How AWS works

Global infrastructure

AWS operates on a global network of data centers, which are grouped into regions and availability zones (AZs). Each region is a separate geographic area that consists of multiple, isolated locations known as availability zones. This setup helps ensure redundancy, backup, and lower latency by distributing services across different areas.


AWS offers a vast array of services covering compute power, storage options, networking, database, analytics, machine learning, security, enterprise applications, and more. These services are managed through the AWS Management Console, Command Line Interface (CLI), or SDKs (Software Development Kits).

Core AWS services

Amazon Web Services (AWS) is a comprehensive and broadly adopted cloud platform, offering over 200 fully featured services from data centers globally.

Computing Power

This is the flagship product of Amazon Web Services. Its Elastic Compute Cloud (EC2) provides instances (virtual servers) for cloud computing capacity. EC2 has numerous instance types to choose from each of varying size and capacity. Instances are tailored to suit specific applications and workload types such as accelerated computing and memory intensive jobs.

It has auto scaling to accommodate evolving performance, capacity and system health needs. The EC2 Container Service and Registry provide images and Docker containers that customers can work with.

Storage Solutions

Simple Storage Service (S3) is a scalable storage that’s ideal for archival, data backup and analytics. Files and data are stored in units referred to as S3 objects, which can be up to 5 GB in size. The objects are stored in S3 buckets for better organization. Businesses can cut their costs of S3 storage by opting for the Infrequent Access tier or, for longer-term cold storage, use Amazon Glacier.

Elastic Block Store is a service that provides persistent block storage that’s ideal for EC2 instances while the Elastic File System is a managed cloud-based storage service.

Database management

The Amazon Relational Database Service provides managed data services with options for major databases including Amazon Aurora, MySQL, Oracle, PostgreSQL, SQL Server, MariaDB and (through DynamoDB) NoSQL. Customers can use DynamoDB Accelerator and Amazon ElastiCache as a cache for applications that require real-time command response.

Amazon Redshift is a data warehouse that simplifies the process of data analysis and business intelligence.

Learn more about Amazon Web Services RDS.


Virtual Private Cloud (VPC) service gives administrators firm control over an isolated portion of AWS cloud that forms their own virtual network. Amazon Web Services provisions resources automatically within the VPC. Administrators can stay on top of network traffic with Network Load Balancer, Application Load Balancer and other load balancing tools from Amazon Web Services.

Route 53 is a domain name system that automatically routes users to respective applications. IT professionals can use AWS Direct Connect to create a dedicated connection between the AWS cloud and an on-site data center.

Other AWS functions

Migration and Transfer Services

Many organizations that choose to subscribe to AWS already have an on-premises server setup. In cognizance of this, AWS has various services and tools to help customers move their data, databases, and applications from their on-premises servers to the public cloud. The Migration Hub for instance makes it easier to centrally oversee and monitor the migration from end to end.

Once systems and data have been successfully moved to the cloud, the EC2 Systems Manager allows the IT teams to configure AWS instances and on-premises servers. AWS has partnered with several leading technology vendors such as VMWare Cloud and Red Hat Enterprise Linux to streamline migration and hybrid deployment.


Administrators can track and manage their AWS cloud via AWS Config, AWS Config Rules and AWS Trusted Advisor. These help IT teams avoid needlessly expensive and improperly configured cloud deployments. Administrators can also automate the process of infrastructure and system provisioning and configuration with CloudFormation templates, Chef and AWS OpsWork.

They can monitor application and resource health with CloudWatch and Personal Health Dashboard while using CloudTrail to retain user activity and API calls for later auditing. There are many more ideas on AWS monitoring including the user of third party tools.

Developer tools

AWS offers tools for developers to code, build, and deploy applications, such as AWS CodeBuild, AWS CodeDeploy, and AWS CodePipeline.

Machine Learning and Artificial Intelligence

AWS provides a broad array of machine learning services and tools like Amazon SageMaker for building, training, and deploying machine learning models.

Security and Identity Services

AWS offers features to help protect privacy and data, control access to resources, and comply with regulations. Services like AWS Identity and Access Management (IAM) and Amazon Cognito are part of this function.

What are the benefits of AWS

1. Cost-effectiveness

  • Pay-as-you-go pricing: With AWS, you pay only for the individual services you need, for as long as you use them, without requiring long-term contracts or complex licensing. This model can lead to significant cost savings compared to the capital expenditure of maintaining physical servers or data centers.
  • Scalable and elastic: AWS allows you to easily scale up or down to handle changes in requirements or spikes in popularity, reducing your need to forecast traffic.

2. Flexibility and openness

  • Wide range of services and technologies: AWS offers over 200 fully featured services including compute, storage, databases, analytics, networking, mobile, developer tools, management tools, IoT, security, and enterprise applications. This wide range of services allows you to use the latest technologies to experiment and innovate more quickly.
  • Programming language and operating system agnostic: AWS supports multiple programming languages, operating systems, databases, and architectures. This flexibility lets you use the tools and technologies you are already familiar with.

3. Scalability and performance

  • Auto-scaling: AWS services like Amazon EC2 Auto Scaling and Amazon Elastic Container Service (ECS) can automatically adjust capacity to maintain steady, predictable performance at the lowest possible cost.
  • Global reach: AWS has a massive global cloud infrastructure that allows you to deploy your applications in multiple physical locations in seconds, improving the experience for your global customer base by reducing latency.

4. Security and compliance

  • Shared responsibility model: AWS operates under a shared responsibility model, where AWS is responsible for securing the underlying infrastructure, and customers are responsible for securing their data and applications in the cloud.
  • Comprehensive security capabilities: AWS provides comprehensive security capabilities to ensure the most demanding information security requirements are met. This includes network security, encryption, access control, and compliance with various standards.

5. Reliability

  • High availability and fault tolerance: AWS provides a highly reliable environment where replacement instances can be rapidly and predictably commissioned. The service runs across multiple data centers for redundancy and continuous availability, ensuring fault tolerance and stability.
  • Backup and disaster recovery: AWS makes data backup, disaster recovery, and business continuity easier and less expensive because data can be mirrored at multiple redundant sites on the AWS global network.

6. Innovation

  • Rapid innovation: The pace of innovation within AWS means new services, features, and tools are regularly made available to help you improve your operations or explore new opportunities.
  • Ecosystem and community: AWS has a large ecosystem of partners and a community of developers and software vendors that can help you use AWS services effectively and innovate within your applications.

The drawbacks of AWS

1. Complexity

  • AWS provides a vast array of services and features, which can be overwhelming for new users. The complexity of options and settings can lead to a steep learning curve.
  • Navigating the AWS Management Console and understanding how to integrate different services effectively can be challenging without proper training or experience.

2. Cost management

  • While the pay-as-you-go model offers cost savings, it can also lead to unexpected charges if usage is not carefully monitored and managed. Without proper cost optimization strategies, bills can escalate quickly, especially when services are left running or resources are over-provisioned.
  • Understanding the pricing structure of each service and managing costs effectively requires continuous attention and expertise.

3. Security and compliance

  • The shared responsibility model means customers are responsible for securing their data, applications, and networks in the cloud. Misconfigurations or lack of understanding of security best practices can lead to vulnerabilities.
  • Navigating compliance and data sovereignty requirements in different regions can be complicated, especially for organizations with strict regulatory obligations.

4. Dependency and lock-in

  • Using AWS-specific services and APIs can lead to vendor lock-in, making it challenging and potentially costly to migrate to another cloud provider in the future.
  • Dependency on AWS as a single cloud provider also introduces risks related to service outages and availability.

5. Performance variability

  • Performance can vary for cloud resources, such as virtual machines, depending on the underlying physical hardware, network traffic, and other factors. This variability can affect applications that require consistent performance.
  • Multi-tenant environments can lead to "noisy neighbor" issues, where other users' workloads impact the performance of your services.

6. Technical support costs

  • While AWS offers various support plans, comprehensive technical support comes at a significant cost. Organizations with complex deployments may find that they need to subscribe to higher-tier support plans to meet their needs.
  • Access to immediate, high-quality support can be expensive, which might be a consideration for startups and small businesses with limited budgets.

7. Geographical limitations

  • Despite AWS's global infrastructure, there are still regions with limited AWS services or data centers, which can affect latency and data sovereignty for businesses operating in those areas.
  • Compliance with data residency and sovereignty laws may require using data centers in specific locations, potentially limiting the services available.

Pricing models of AWS


  • This is the most flexible pricing model where you pay only for the compute, storage, or other resources you use with no long-term commitments or upfront payments. This model is ideal for businesses looking for short-term, scalable, and variable costs based on actual usage.

Reserved Instances (RI)

  • Reserved Instances allow customers to reserve a specific instance type for a 1-year or 3-year term, offering a significant discount compared to on-demand instance pricing. This model is suitable for applications with steady-state or predictable usage and can lead to substantial cost savings over time.

Savings plans

  • Savings Plans is a flexible pricing model that provides lower prices on your AWS usage in exchange for committing to a consistent amount of usage (measured in $/hour) for a 1-year or 3-year term. Unlike Reserved Instances, Savings Plans apply to a wide range of services and usage, offering more flexibility.

Free tier

  • AWS offers a Free Tier for new customers, which includes a certain amount of resources and services at no cost for one year, as well as some services that remain free indefinitely. This tier is ideal for experimenting with AWS services, prototyping, or learning about cloud computing.

Effective cloud migration

Amazon Web Services (AWS) offers robust support for cloud migration through various tools, services, and best practices, making the transition smoother and more efficient for businesses. However, you always need a strategy to perform cloud migration without interuptions.

Effective cloud migration strategy consists of 14 steps:

  • Step 1: Characterize the current state of your business
  • Step 2: Identify the goals you want to achieve
  • Step 3: Evaluate your resources
  • Step 4: Choose cloud environment
  • Step 5: Choose a cloud provider
  • Step 6: Design cloud architecture
  • Step 7: Prioritize workloads
  • Step 8: Create data migration plan
  • Step 9: Migrate applications
  • Step 10: Optimize and refactor
  • Step 11: Establish security measures
  • Step 12: Train and Educate Teams
  • Step 13: Monitor and optimize
  • Step 14: Choose a trusted business partner

Learn more about: how to plan effective cloud migration.

AWS supports enteprise cloud computing

Amazon Web Services (AWS) provides robust support for enterprise cloud computing through a variety of services and features designed to meet the complex needs of large organizations. It provides:

  1. Scalability and Flexibility: Enables enterprises to scale resources according to demand.
  2. Comprehensive Services: Offers a wide range of services including computing, storage, networking, and databases.
  3. Security and Compliance: Provides a secure infrastructure with compliance to various industry standards.
  4. Disaster Recovery: Offers robust solutions for data durability and disaster recovery.
  5. Enterprise Support: Includes enterprise-level support and managed services.
  6. Cost Management Tools: Tools like AWS Cost Explorer help manage and optimize spending.

AWS features for cloud scalability

Amazon Web Services (AWS) supports cloud scalability through several key features and services:

  1. Elastic Compute Resources: AWS provides scalable compute services like Amazon EC2 (Elastic Compute Cloud), which allows users to increase or decrease capacity within minutes, not hours or days. You can commission one, hundreds, or even thousands of server instances simultaneously.
  2. Auto Scaling: AWS Auto Scaling monitors applications and automatically adjusts capacity to maintain steady, predictable performance at the lowest possible cost. It can be set up to automatically scale EC2 instances, Amazon ECS tasks, Amazon DynamoDB tables, and other AWS resources.
  3. Load Balancing: AWS offers Elastic Load Balancing (ELB) to distribute incoming application traffic across multiple targets, such as Amazon EC2 instances, containers, IP addresses, and Lambda functions. This ensures that application scaling is smooth and that no single instance is overloaded.
  4. Serverless Architecture: Services like AWS Lambda allow for running code without provisioning or managing servers. This service automatically scales your application by running code in response to events, adjusting the compute capacity behind the scenes.
  5. Storage Scalability: AWS provides scalable storage solutions such as Amazon S3 (Simple Storage Service) for object storage and Amazon EBS (Elastic Block Store) for block storage, which can be scaled up or down as needed.

Other options - competitors of AWS

1. Microsoft Azure

  • Azure is Microsoft's cloud computing service, offering a wide range of services including compute, analytics, storage, and networking. Azure is particularly strong in the enterprise market, thanks to its seamless integration with Microsoft's software products like Windows Server, Active Directory, and SQL Server. Azure appeals to businesses deeply embedded in the Microsoft ecosystem.

2. Google Cloud Platform (GCP)

  • Google Cloud Platform provides cloud services that leverage Google's core infrastructure, data analytics, and machine learning. GCP is known for its high-performance computing, big data, and analytics capabilities, as well as its strengths in machine learning and open-source technologies. It's a popular choice for companies focused on AI and analytics.

3. IBM Cloud

  • IBM Cloud includes a wide range of services such as IaaS, SaaS, and PaaS offerings. It is known for its strong focus on AI and machine learning through Watson, blockchain technology, and also for its deep industry expertise, especially in sectors like healthcare, finance, and government.

4. Oracle Cloud

  • Oracle Cloud offers a comprehensive cloud computing service, including SaaS, PaaS, and IaaS offerings. It is particularly known for its database services, enterprise resource planning (ERP) software, and cloud applications. Oracle Cloud is a preferred choice for businesses that rely heavily on Oracle databases and software.

Final word

With a clear lead over its competitors such as Microsoft Azure and Google Cloud and with millions of organizations and individuals currently leveraging the power of Amazon Web Services, offering cloud services is certainly one of the best business decisions that has Amazon made.

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Olga Gierszal
IT Outsourcing Market Analyst & Software Engineering Editor

Software development enthusiast with 7 years of professional experience in the tech industry. Experienced in outsourcing market analysis, with a special focus on nearshoring. In the meantime, our expert in explaining tech, business, and digital topics in an accessible way. Writer and translator after hours.

Olga Gierszal
IT Outsourcing Market Analyst & Software Engineering Editor

Software development enthusiast with 7 years of professional experience in the tech industry. Experienced in outsourcing market analysis, with a special focus on nearshoring. In the meantime, our expert in explaining tech, business, and digital topics in an accessible way. Writer and translator after hours.

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