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Amazon Web Services dominates public cloud computing. That’s clear. What’s less clear is how any competitor can catch up to the cloud giant, given the manner in which it has grown. As 451 Research analyst Brenon Daly notes, “Amazon has almost exclusively used R&D–rather than M&A–to build AWS.”

That may seem like a small thing, but it’s actually essential to Amazon’s market leadership, and a continued barrier to its would-be cloud rivals. Any company that hopes to topple AWS from its cloudy throne must do so organically. First place in the cloud cannot be bought.

Iteration is innovation

As Robert Hof styles it, “The unlikely offspring of a retail company, AWS has managed to outmaneuver computing and Internet giants from Microsoft and Google to IBM and Oracle.” That “outmaneuver[ing]” translates into billions of dollars in revenue and the primary profit center for all of Amazon.

SEE: Power checklist: Managing and troubleshooting cloud storage (Tech pro Research)

A primary way that the company has managed to do this is by constantly iterating on its offerings.

Just how fast does AWS innovate? Measured simply in terms of new features, AWS has launched over 1,000 new features since 2008, even as it has dropped prices again…and again…and again.

This ability to innovate even as it drops prices comes from Amazon’s superior economies of scale, though not in the way you might think. As cloud luminary Randy Bias explains, “The real economies of scale that are relevant here are the tremendous investments in R&D that have led to technological innovations that directly impact the cost structures of Amazon Web Services.”

So how does AWS innovate?

Some of AWS innovation derives from under-developing its feature set. Or, more accurately stated by Amazon CTO Werner Vogels, “When customers left the constraining, old world of IT hardware and datacenters behind, they started to develop systems with new and interesting usage patterns that no one had ever seen before. As such, we needed to be ultra-agile to make sure we were catering to our customers’ needs.”

That agility led AWS to “deliver new services often with a minimal feature set and allow our customers to help drive the roadmap for extending the service with new features.” It’s a completely different mindset for innovation, one not easily replicated by old-guard vendors that are used to delivering software, not iterations on services.

Another area of innovation, according to Vogels, is a willingness to build rather than buy essential infrastructure:

AWS has developed a unique skill to innovate datacenter layout and operations, such that we can have flexible network infrastructure that can be adapted to meet the needs of our customers’ workloads, whatever they may be. We have learned over time that we should not be afraid to develop our own hardware solutions to ensure our customers can achieve their goals. This enables us to meet our very specific requirements, such as the ability to isolate AWS customers from each other on the network to achieve the highest levels of security.

So, how does the rest of the cloud world compete?

Build, not buy, a clue

IBM and its traditional IT peers have largely tried to compete with AWS by buying competitors. In IBM’s case, it has spent billions buying SoftLayer, Cloudant, and other components of an AWS response. To quote Daly, “Each year, tech vendors collectively spend hundreds of billions of dollars expanding their product portfolios and addressable market, only to struggle to put up any growth.”

It hasn’t worked, generally, and it certainly hasn’t halted the AWS train, which grew 72% last year to post $7.9 billion in revenue.

Each of the legacy IT vendors has to come to grips with what Andy Oliver outlines for Oracle:

If you’re willing to consider a cloud, then you’re willing to consider an IT migration project–and if you’re willing to do that, then why not cut your losses and move to newer technology, better pricing, and a better solution? For Oracle to have a play here, it will have to do something it hasn’t done in years: Develop an actual product and a compelling reason to buy it.

I’m not sure if Oliver meant “develop an actual product” in the sense of “organically building it,” but I believe he should, if he didn’t. As Vogels intimates in his post, many of the most critical lessons AWS learned about the cloud came from building it, which understanding simply can’t be acquired and grafted into a legacy enterprise. The cloud is different. It requires different thinking.

Sure, these established vendors have a headstart of sorts, because they have cozy, longstanding relationships with enterprises. As InfoWorld’s Eric Knorr argues, Oracle, IBM, and Microsoft “have aggressive cloud initiatives that include analytics and IoT tooling. Certainly they will be able to hang on to many enterprise customers and usher them into the cloud era.”

SEE: Amazon Web Services: The smart person’s guide (TechRepublic)

Will they get one chance to do this? Yes. Two? Maybe. Three? Almost certainly not.

And with developer pressure to adopt that which is easiest and “just works” today, the incumbent vendors may find that their affinity for what’s comfortable may not be enough. So they’ll have to figure out how to compete with AWS, which means they’ll need to build, not buy, a clue.