Wednesday, October 31, 2012

Amazon.com, Inc. (NASDAQ:AMZN) sees Google Inc(NASDAQ:GOOG) Compute as threat

Amazon.com, Inc.(NASDAQ:AMZN) Web Service has filed a lawsuit against a former company executive who plans to join Google Inc(NASDAQ:GOOG), charging him with violating a non-compete agreement which was part of his severance package.

The lawsuit filed by Amazon also said that the executive, Daniel Powers, was privy to the `secrets' of the company since he had learned the business "from top to bottom."

The threat to Amazon Web Services is perceived to be from Google Compute Engine, which was launched in June, and is part of its cloud services offering.

Geekwire first reported the news. According to the news - "Daniel Powers, an IBM veteran, joined AWS as VP of sales in 2010, learned the business “from top to bottom” and was privy to company trade secrets, according to the suit. In June, 2012 Amazon offered him a severance package in return for a signed non-compete agreement. This suit, filed in Washington State Superior Court, charged that Powers’ decision to join Google violates the terms of that pact, which required him to stay clear of directly competitive work for 18 months."

Google Compute Engine is being seen as a huge threat to Amazon, which is the biggest provider of public cloud infrastructure. In fat Amazon is already expecting more competition from Rackspace, HP and Microsoft, all of which are aggressively moving into cloud-based services.

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