Amazon Goes After Box, Dropbox And Huddle, Launches Zocalo For Secure Enterprise Storage
E-Commerce giant Amazon has made huge competitive inroads into the cloud services market with Amazon Web Services, and today it's adding another feature that will put it into direct competition …
Context & Ripple Effects
Amazon has spent the past month turning AWS into a weapon against its own ecosystem: in June it matched Google within a day on solid-state block storage (launching speedy SSD volumes), and this week it moves further up the stack with Zocalo, a managed, security-focused file-sharing service aimed squarely at Box, Dropbox and Huddle. The breadth of same-day pickup — VentureBeat, Gigaom, Forbes, ZDNet, CNET, GeekWire and others all carried the news — reflects how directly the launch threatens a category of startups that largely run on AWS infrastructure.
The timing matters too: Amazon is fighting on multiple fronts this month, between the Fire Phone launch and the public Hachette standoff, so Zocalo reads less like a side project and more like AWS doubling down on enterprise services where its margins and customer relationships are strongest.
First-order effects
- Box, Dropbox and Huddle wake up competing against their own landlord: Zocalo ships inside AWS accounts many of them already sell through, giving Amazon distribution and billing access no rival can match.
- Enterprise IT buyers gain a security-audited sync-and-share option that requires no new vendor relationship, shortening sales cycles for Amazon and lengthening them for the incumbents.
Second-order effects
- Sync-and-share vendors are forced to defend on application-layer value — workflow, integrations, compliance tooling — because they cannot win a price war against the company selling them the underlying storage.
- Startups building on AWS now have to weigh that every layer they add on top of S3 and EC2 is a candidate for Amazon to productize, raising the strategic cost of the platform dependence that made AWS cheap.
Third-order effects
- If the pattern holds — infrastructure providers absorbing adjacent application categories — the SaaS landscape stratifies into firms Amazon competes with and firms Amazon merely hosts, pushing independent software toward niches too specialized or too multi-cloud for AWS to bundle.
- Enterprise procurement consolidates around single mega-vendors, trading best-of-breed point tools for integrated suites from whichever cloud already holds the contract.
The trend: AWS is climbing the stack from raw infrastructure into packaged enterprise applications, converting the startups built on its rails into competitors one service launch at a time.