Netflix In The Cloud, Relying On Amazon

Availability is key because people watching Netflix digital downloads make up a significant portion of total Web bandwidth usage. It generates approximately 20% of traffic in the U.S. from 8 p.m. to 10 p.m. local time, according to an Internet study by private software maker Sandvine.

The cloud infrastructure services market will grow 48

The cloud infrastructure services market will grow 48.8% a year to $12.4 billion by 2014 from $2.7 billion last year, Gartner predicts. Total cloud-based revenue, including hosted software and Web services, will hit $148.8 billion at that time.

AWS launched its Simple Storage Service, or S3, in March 2006. Amazon does not break out AWS revenue, nevertheless it grew approximately 155% last year based on related data for S3. AWS stored 260 billion objects or files at the close of 2010 vs. 102 billion files at the end of 2009.

Low-cost subscription basis

Cloud vendors are paid on a low-cost subscription basis, and only for the computer resources their customers use. One can quickly sense "the collision of the two business models," says Selipsky.

"This change poses a significant problem for the old guard of the research world," he said. "Those companies have taken a long time to evolve into the cloud, and I suspect it's because those companies don't want to evolve."

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