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Pizzazz–and Profits
Developers accepted the invitation, and downloaded Amazon’s Web services APIs, help manuals, and sample code in droves (see “Developing Interest,” right). “I was amazed that they did what they did, because companies are usually so reluctant to expose their databases,” says Paul Bausch, who had become interested in Web services while building Blogger at San Francisco-based Pyra Labs. After Google acquired Pyra in 2003, Bausch returned to the life of an independent software developer and had so much fun playing with Amazon’s new programming interfaces that he ended up writing Amazon Hacks. Among other things, the book teaches readers how to embed Amazon product information in their Web pages and (on a less serious note) how to add pizzazz to their personal archives of MP3 songs by grabbing CD cover art from Amazon.

In one way, Amazon Web Services is simply an extension of longstanding collaborations such as Amazon Associates, in which external website owners can earn commissions of up to 10.5 percent for referrals. But previously, affiliate sites could only show simple links to Amazon products; with Web services, the possibilities became much broader (see “Amazon Everywhere,” below).

At one end of the spectrum are sites like Taylor’s Amazon Light that simply proffer Amazon in a different skin. At the other end are noncommercial sites where Amazon data isn’t the main attraction but is used to enhance other offerings. One example is AllConsuming.net, which appeals to bibliophiles by scouring thousands of blogs every hour, listing the most talked-about books, and providing snippets from each blogger’s comments. Designed by Erik Benson, another ex-Amazonian, the site dips into the Amazon database for cover images and other details about the listed books and offers links to each book’s page at Amazon.

Benson says AllConsuming isn’t making him rich, but it does bring in enough commissions to cover its own hardware and bandwidth costs (about $400 a month). Other companies earn far more by acting as middlemen. Monsoon of Portland, OR, for example, builds software that helps its own customers use Amazon’s Web services to simplify inventory management.

By November 2004, the number of developers participating in Amazon Web Services had grown to 65,000. To keep up with their demands, the company has kept updating its APIs to open up more types of product information and more functions, such as wish lists and advanced searches. How many purchases originate each day with Amazon’s growing web of syndicated storefronts? The company won’t say, but experts have estimated that sites using the company’s Web services send 10 million requests a day to Amazon’s servers.

Amazon is far from the only company exploring Web services. IBM, for example, has opened its Websphere server software to outside developers and expects to invest $1 billion this year in new business-to-business Web services, according to Michael Liebow, director of Web services for IBM Global Services, the company’s consulting wing. One IBM creation: a system that uses XML and other standards to tie together the disparate databases used by merchants, banks, and credit-card firms, helping to resolve disputed credit-card charges faster.

In fact, Web services’ biggest impact may not be the syndication of individual businesses’ information, as in Amazon’s case, but the standardization of business processes across whole industries, such as finance, electronics, or automobiles, according to Liebow. “Amazon is unique,” he says. “It’s kind of a closed system, and there’s a level of control.”

That’s true–and Amazon reserves the right to shut down its Web services at any time. But doing so would destroy the rare symbiosis that has emerged from years of careful community building. “Developers are another kind of customer for us,” says Jeff Barr. “The work they do is going to bring even more diverse types of customers.” In other words, by sharing not just its data but also its retailing tools and a modest slice of the profits, Amazon has turned a programming subculture typically ruled by anticorporate suspicion and paranoia into a wellspring of evangelism, not to mention a funnel for revenue. Surely, that’s one for the books.

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