What Is AWS? Amazon Web Services Explained for Businesses

Amazon Web Services (AWS) is the world's largest cloud computing platform, offering over 200 services including computing power, storage, databases, machine learning, networking, and security — all delivered on-demand over the internet. Launched by Amazon in 2006, AWS now commands 31% of the global cloud infrastructure market (Synergy Research, Q3 2025), serving millions of customers from startups to Fortune 500 companies.

In simple terms: AWS lets you rent computer infrastructure from Amazon instead of buying and maintaining your own. You access servers, databases, and other IT resources through a web portal, use what you need, and pay by the hour or second.

How AWS Works

AWS operates a global network of data centers organized into Regions and Availability Zones:

• Regions: 33 geographic areas worldwide (e.g., US East - Virginia, EU - Ireland, Asia Pacific - Mumbai). You choose which region hosts your data based on latency, compliance, and cost requirements.
• Availability Zones (AZs): Each region contains 2-6 physically separate data centers with independent power, cooling, and networking. Deploying across multiple AZs provides high availability.
• Edge Locations: 600+ points of presence for content delivery (CloudFront CDN), reducing latency for end users globally.

When you use AWS, you are renting slices of this massive infrastructure. A virtual server (EC2 instance) running in Virginia might physically be a fraction of a server in one of AWS's data centers in Ashburn, but to you it behaves like a dedicated machine you fully control.

Core AWS Services Every Business Should Know

Compute

Service	What It Does	Use Case
EC2	Virtual servers (instances) you configure and manage	Running applications, web servers, databases
Lambda	Run code without managing servers (serverless)	Event-driven processing, APIs, automation
ECS / EKS	Container orchestration (Docker / Kubernetes)	Microservices, containerized applications
Lightsail	Simplified virtual servers with fixed pricing	Small websites, development environments

Storage

Service	What It Does	Starting Price
S3	Object storage for files, backups, and static content	$0.023/GB/month
EBS	Block storage attached to EC2 instances (like a hard drive)	$0.08/GB/month (gp3)
Glacier	Cold archival storage for data you rarely access	$0.004/GB/month
EFS	Shared file system accessible by multiple instances	$0.30/GB/month

Database

• RDS: Managed relational databases (MySQL, PostgreSQL, SQL Server, Oracle, MariaDB)
• DynamoDB: Fully managed NoSQL database with single-digit millisecond performance
• Aurora: AWS-designed relational database, 5x faster than standard MySQL
• ElastiCache: In-memory caching with Redis or Memcached

Networking

• VPC (Virtual Private Cloud): Your own isolated section of the AWS cloud with custom network configuration
• Route 53: DNS management and domain registration
• CloudFront: Global CDN for fast content delivery
• Direct Connect: Dedicated private connection from your office to AWS

Security

• IAM (Identity and Access Management): Control who can access what in your AWS account
• GuardDuty: Threat detection service that monitors for malicious activity
• WAF (Web Application Firewall): Protects web applications from common exploits
• KMS (Key Management Service): Create and manage encryption keys

AWS Pricing: How Much Does It Cost?

AWS uses a pay-as-you-go pricing model. You pay only for what you consume, with no upfront commitments (though Reserved Instances offer significant discounts for commitments).

Common Monthly Costs for an SMB

Workload	Typical Configuration	Estimated Monthly Cost
Small web application	1 t3.medium EC2, 100GB EBS, S3, RDS small	$150-$300
Business website + database	2 t3.medium EC2 (load balanced), RDS, CloudFront	$300-$600
Enterprise application	Multiple EC2 instances, RDS Multi-AZ, S3, VPN	$1,000-$5,000+
Development/testing environment	1-2 t3.small instances, minimal storage	$50-$150

Ways to Reduce AWS Costs

• Reserved Instances: Commit to 1 or 3 years for 30-72% savings on EC2
• Savings Plans: Flexible commitment-based pricing with up to 72% savings
• Spot Instances: Use spare EC2 capacity at up to 90% discount (can be interrupted)
• Right-sizing: Analyze actual resource utilization and downsize over-provisioned instances
• S3 lifecycle policies: Automatically move infrequently accessed data to cheaper storage tiers
• Auto Scaling: Scale instances up and down based on demand to avoid paying for idle resources

AWS vs Azure vs Google Cloud

Factor	AWS	Azure	Google Cloud
Market share	31%	25%	11%
Services available	200+	200+	150+
Best for	Broadest service selection, startups, DevOps	Microsoft ecosystem, enterprise, hybrid cloud	Data analytics, ML/AI, Kubernetes
Strengths	Maturity, documentation, community, largest partner ecosystem	Active Directory integration, Windows workloads, government	BigQuery, GKE, data engineering
Free tier	12 months + always-free services	12 months + always-free services	$300 credit + always-free services
Pricing model	Per-second (most services)	Per-minute (most services)	Per-second

Which should you choose? If your business runs Microsoft 365 and Windows workloads, Azure is often the natural fit. If you need the widest range of services or run Linux-based workloads, AWS is typically the best choice. If your focus is data analytics or machine learning, Google Cloud excels. Many organizations use multiple clouds (multi-cloud) to leverage each provider's strengths.

AWS Certifications

AWS certifications are among the most valuable in IT, with certified professionals earning 20-30% more than non-certified peers.

• Cloud Practitioner (Foundational): Non-technical overview of AWS services, pricing, and architecture. Good for business leaders and sales teams.
• Solutions Architect Associate: The most popular AWS cert. Covers designing resilient, high-performing, secure architectures. Required for most cloud engineering roles.
• SysOps Administrator Associate: Focuses on deploying, managing, and operating AWS workloads. Best for IT admins and MSP engineers.
• Developer Associate: Building and deploying applications on AWS. Best for software developers.
• Solutions Architect Professional: Advanced architecture design. Commands the highest salary premium.

AWS for MSPs

AWS actively courts MSPs through the AWS Partner Network (APN) and the MSP Partner Program. MSPs that manage AWS infrastructure for clients gain access to co-selling opportunities, technical training, and partner-exclusive credits.

The challenge is that AWS expertise is expensive to build and maintain. Certified AWS engineers command $110,000-$160,000+ salaries, and the platform evolves rapidly with hundreds of new features annually.

This is where white-label cloud services help MSPs compete. At Medha Cloud, our AWS-certified engineers manage client infrastructure under your brand, handling:

• EC2 instance management and optimization
• S3 storage configuration and lifecycle policies
• VPC networking and security group management
• RDS database administration
• Cost optimization and right-sizing recommendations
• 24/7 monitoring and incident response

Frequently Asked Questions

What is AWS used for?

AWS is used for hosting websites, running applications, storing data, managing databases, delivering content globally, building machine learning models, and virtually any other computing task. Businesses use it to avoid buying physical servers and instead rent computing power on-demand. Netflix, Airbnb, NASA, and millions of other organizations run on AWS.

Who is AWS's biggest competitor?

Microsoft Azure is AWS's biggest competitor with 25% market share compared to AWS's 31%. Google Cloud Platform (GCP) is third with 11%. In specific markets, Azure leads in enterprises already using Microsoft products, while GCP leads in data analytics and Kubernetes. AWS maintains the broadest service portfolio and largest partner ecosystem.

Is AWS free?

AWS offers a Free Tier with: 12 months of limited free usage (750 hours/month of t2.micro EC2, 5 GB S3 storage, 750 hours RDS), plus always-free services (1 million Lambda requests/month, 25 GB DynamoDB). For real business workloads, you will need to pay, but the Free Tier is valuable for learning and development.

Is AWS hard to learn?

AWS basics (EC2, S3, RDS) can be learned in 2-4 weeks by someone with IT experience. Earning the Solutions Architect Associate certification typically takes 2-4 months of study. The platform is complex because it offers 200+ services, but most businesses use fewer than 20. Start with core services and expand as needed.

Key Takeaways

• AWS is the world's largest cloud platform (31% market share) with 200+ services across 33 regions.
• Core services include EC2 (compute), S3 (storage), RDS (databases), VPC (networking), and IAM (security).
• Pay-as-you-go pricing starts at $50-$150/month for small workloads; Reserved Instances save 30-72%.
• AWS is best for broad service selection and Linux workloads; Azure for Microsoft shops; GCP for data/ML.
• MSPs can scale their AWS practice through white-label cloud services without the $110K-$160K cost of hiring in-house.