Amazon.com, Inc. (AMZN)’s Frienemies and Their Options: Rackspace Hosting, Inc. (RAX), Equinix Inc (EQIX)

But if the future of enterprise cloud-computing is using multiple services, Equinix Inc (NASDAQ:EQIX) is well-positioned to capitalize. The company, through its partnership with RightScale, offers services that allow small companies just getting started to allocate their workload to the most cost-effective providers, as well as creating a redundant network across multiple providers for large enterprises. With a background in interconnecting business networks, Equinix has optimized network connections with both the customers and the service providers. That makes them the natural choice for a multi-cloud hub.

Is it worth it?

The question is how much better are these options than what Amazon offers? For my part, I don’t think they offer any huge advantage or impetus to switch from Amazon. Equinix is probably the best solution, but the costs of using multi-cloud redundancy to reduce outages can become very expensive very quickly for companies with huge amounts of data like Netflix. It’s not necessarily the most effective use of cash to improve a system that already operates perfectly 99.9% of the time.

Furthermore, as Neil Hunt pointed out in 2011 on Quora, it’s on enterprises to engineer fail-safes and take precautions to prevent outages from affecting them, which is still a possibility even with multi-cloud redundancy. Netflix has a group of engineers that work on projects such as “Chaos Monkey” and “Chaos Gorilla” that try to break AWS to expose the potential failures of its system and fix them before they’re ever a problem. Big enterprises with lots of data will likely find the option of hiring a few hackers to engineer these types of services more economical than duplicating massive amounts of data across multiple cloud providers.

Certainly, smaller companies might be attracted to the security and safety of an OpenStack hybrid. Yet, Amazon still has a pricing advantage over the competition, so small startups strapped for cash will likely forego the added security benefits. Companies like Netflix Best Buy probably aren’t going to leave any time soon for cost reasons as well. I expect Amazon’s frenmity (friendliness/enmity) toward those companies to continue for now.

The article Amazon’s Frienemies and Their Options originally appeared on Fool.com and is written by Adam Levy.

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