What's the last thing a new, groundbreaking technology needs that promises the sky? A spectacular crash down to Earth.
Amazon, the online retail giant, suffered a major outage of its Web services on Thursday that shuttered some web sites including one of the leading RSS feeds Reddit, which the Associate Press reports is running in "emergency read-only mode."
Lydia Leong, an analyst for the tech research firm Gartner, told the AP that "judging by details posted on Amazon's AWS status page, a network connection failed Thursday morning, triggering an automatic recovery mechanism that then also failed."
There's little doubt that Amazon will get its cloud service back in working order in the very near future -- and in fact, it might be live by the time you read this. But once the dust settles, Amazon has another crisis on its hands: How to convince Wall Street and smaller investment firms that their data and high compute projects are safe in its cloud.
Of course, firms like Morgan Stanley and Goldman Sachs has their own clouds and compute grids but smaller firms do not. If you were launching a hedge fund and needed vast amounts of storage, a cloud service like Amazon's is extremely attractive. But before you start dragging and dropping data about your clients, investment strategies and risk profiles from your computer onto a cloud hundreds or thousands of miles away, a moment of doubt arrives. Is my data safe? Will I be able to retrieve it tomorrow, next week or next year? What about after lunch?
Once Amazon's cloud problems are solved, it needs to assure the industry that its clouds won't blow away.
Full disclosure: I subscribe to Amazon's Cloud Drive for storing my music files. So far, my songs are safe and sound. Phil Albinus is the former editor-in-chief of Advanced Trading. He has nearly two decades of journalism experience and has been covering financial technology and regulation for nine years. Before joining Advanced Trading, he served as editor of Waters, a monthly trade journal ... View Full Bio