Amazon Web Services sets up Philippine office

MANILA, Philippines – Amazon Web Services (AWS) is the latest global tech firm to set up shop in the Philippines this year after social media giant Facebook, online grocer Happy Fresh, and cyber security firm CyberInt, among others.

The move, announced at the latest AWS Summit held recently at the Makati Shangri-La hotel, is expected to further boost the uptake of enterprise cloud computing in the country.

AWS executives, led by chief technology officer (CTO) Dr. Werner Vogels, expressed confidence in the country’s potential to adopt cloud applications, saying that the local office will provide technical support to its growing base of Philippine clients, which now include the country’s biggest firms such as Jollibee Foods Corp., Voyager Innovations, Seaoil, McDonald’s, Globe Telecom, and the International Rice Research Institute.

It also counts among its clients successful local startups LifeTrack Medical Systems, mClinica, Pinoy Travel, Coins.ph, and Xurpass.

The Philippine office, set up after Malaysia and Thailand, is the company’s 21st office in Asia-Pacific. Singapore will remain as the regional headquarters.

While in the process of setting up shop here (the company is looking for a country manager, account managers, solutions architects and partner and alliance managers), Nick Walton, head of Asean, will manage the Philippine operations, according to AWS executives.

“The business is growing so fast in this part of the world. The recent opening of our offices in Manila, in Bangkok and Kuala Lumpur really show that the whole area is exploding. It’s a consequence of how fast we are growing in the region. We really want to make sure that customers have good customer support,” Dr. Vogels said.

He added that he is confident about the abundance of local talent given that the educational system is competitive and the English language competence of the workforce is high. “We hope that engineers will choose to work for us,” he said. “There are great advantages to working for AWS, even from a more global perspective.”

AWS at 10

AWS’s entry in the Philippine market came on the heels of the release of Amazon’s first quarter earnings report, which shows that more than half ($604 million) of the tech firm’s operating income of $1.1 billion came from its cloud computing arm.

There have been projections that the company’s cloud service even has the potential to outstrip its retail business.

In a letter to shareholders dated April 5, Amazon CEO Jeff Bezos said AWS is on track to reaching $10 billion in annual sales this year.

“AWS is bigger than Amazon.com was at 10 years old, growing at a faster rate, and – most noteworthy in my view – the pace of innovation continues to accelerate. We announced 722 significant new features and services in 2015, a 40 percent increase over 2014,” he said in the letter.

Bezos waxed a little nostalgic in recalling that AWS started in the US just over 10 years ago as a simple storage service.

“Today, AWS offers more than 70 services for computing, storage, databases, analytics, mobile, Internet of Things, and enterprise applications,” he said. “We also offer 33 Availability Zones across 12 geographic regions worldwide, with another five regions and 11 Availability Zones in Canada, China, India, the US, and the UK to be available in the coming year,” he added.

Asked what would it take to sustain this momentum, Dr. Vogels said innovation is key. “We are really at the forefront of building new technology services,” he said. “I think we have a unique proposition that is really focused on how our customers want to use IT. And there’s still so much to be done.”

In Asia and other emerging markets, he said capital is still scarce and if businesses would want to purely innovate on their own, using their own servers, they need to make huge significant investments.

“There is no business today that starts off with buying hardware,” he stressed. “It puts pressure on us to provide security, very good reliability, and performance on networks that customers can scale in our platform.”

Enterprises, startups in the ‘cloud’

One of AWS’ biggest clients in the Philippines is Globe Telecom, which has 53 million mobile subscribers, four million broadband customers, and revenues of P114 billion ($2.4 billion) by the end of 2015.

Ernest Cu, president and CEO of Globe Telecom, said in a testimonial during the summit that the company’s achievements will never be achieved without innovation, supported by a cloud-first policy.

“We make it very difficult for people at Globe to buy servers because we wanted them to go cloud first,” he said. “To sustain our growth, we need to bring products and services to market very quickly. I think we have the largest footprint today for the Philippines for Amazon,” he said.

Globe has over 100 applications with 11,000+ instances running on AWS, has a total footprint of 800 Terabytes, and direct connection to the AWS Data Center in Singapore at 10 Gbps.

“Another benefit we have seen is that Amazon has made us realize the power of virtualization. It allows us to create applications very quickly and scale very quickly,” Cu added.

The country’s largest fastfood chain, Jollibee Foods Corp., has also been using AWS since 2008.

Robert San Juan, vice president for corporate information management at Jollibee Food Corp., said the AWS cloud is useful in running mission-critical applications, e-commerce, Intranet and POS data.

Future innovations include a mobile self-ordering system, mobile app rewards system, tablet ordering system, POS system, kitchen system, digital menu board, and mobile dashboards.

But it isn’t just the large enterprises that are benefiting from the cloud. Dr. Vogels said AWS actually has a program for startups  called the AWS Activate, which is designed to provide startups with the resources needed to get started on cloud computing.

Startups receive guidance from AWS expertise as well as web-based training, self-paced labs, customer support, access to third-party solutions and AWS service credits.

One startup client is Manila-based Coins.ph, which provides mobile money transfer services using blockchain technology.

“We started two years ago with a very simple mission. We want to make sure everybody has direct access to financial services,” said Ron Hose, CEO of Coins.ph. “As a fast-moving startup, we chose AWS for the breadth of services and quick time to market. AWS enables a micro service architecture built on top of fault tolerant services.”

Hose claims that 2015 was a banner year for the company, having grown its customers from 300,000 to half a million, the scale made possible by the AWS Cloud.

“In Southeast Asia, we are seeing startups continue to build their businesses in the AWS cloud,” concluded  Walton. “We will continue to expand in 2016 and 2017.”