This Analyst Is Optimistic On Amazon's AWS, But Concerned About Oracle's Database Business

Trip Chowdhry of Global Equities Research is one of the Street's top authorities on Amazon.com, Inc. AMZN's AWS business, having followed the unit closely since 2009.

Chowdhry commented in a note to clients on Friday that Amazon's AWS business is "focused on capturing the future," as opposed to Oracle Corporation ORCL's database business strategy of "protecting the past."

"Oracle is a 40-year-old company, and the Technology architecture, mindset, culture and strategies are pretty much out-dated when compared to AMZN AWS," the analyst wrote. "Forty (40) years back storage was hugely expensive, and ORCL Database was architected for Optimizing the Storage...and this is the perpetual problem for ORCL."

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The analyst continued that today storage is "dirt cheap," and the signs are pretty clear. Back in 2014, Amazon's AWS business would procure storage in the gigabytes and terabytes, but today the company is able to ask vendors to ship storage by weight.

Chowdhry added that Amazon's AWS database is optimized for CPU and not storage and has "at-scale" model operating at 10x the performance but at one-tenth of the price. Oracle's database on the other hand is optimized for storage, which again, is "dirt cheap."

Finally, the analyst suggested the ongoing industry-wide trend is heading toward database that is optimized for CPU. Accordingly, he is "optimistic" on Amazon's AWS business and at the same time "concerned" about Oracle's database business.