| Tuesday, October 21, 2025 Dear Valued Reader, Amazon's day-long AWS outage Monday knocked out websites and apps for millions, serving as a stark reminder of the modern internet's structural vulnerability. While services have been restored, the incident highlights how the concentration of cloud infrastructure among three providers creates systemic risks that won't disappear anytime soon. Key TakeawayAmazon's AWS outage originated in its Virginia data center, affecting domain name systems and database services globally. The incident underscores the internet's fragility when reliant on just three major cloud providers—Amazon, Microsoft, and Google—with smaller companies unable to afford multi-cloud redundancy. What HappenedThe outage originated at Amazon's US-East-1 data center in Virginia, involving domain name system issues and the company's DynamoDB database service. The domain name system acts as the internet's phone book, translating URLs into numerical IP addresses that computers recognize, while DynamoDB allows customers to store and access data. Problems with both created cascading failures that kept websites offline for much of the workday. For those who enjoyed an impromptu day off, this was an unexpected benefit. For businesses dependent on AWS infrastructure, it represented lost revenue, disrupted operations, and frustrated customers with no recourse but to wait for Amazon to resolve the problem. A Recurring PatternThis isn't AWS's first rodeo. A similar 2023 outage knocked websites offline, while CrowdStrike's faulty update took down large portions of Microsoft's cloud services in 2024. The pattern reveals how dependent the modern internet has become on just three cloud providers: Amazon, Microsoft, and Google. These companies command the resources and expertise to maintain global infrastructure at scale, creating standardization benefits and generally reliable service. But concentration also creates single points of failure where one company's technical problem becomes everyone's problem. The Small Business DilemmaMajor enterprises and government offices often subscribe to multiple cloud providers specifically to avoid complete outages. If one service fails, operations can shift to backup infrastructure from another provider. This redundancy comes at significant cost—both in subscription fees and the technical complexity of managing multi-cloud environments. Smaller companies and organizations typically can't afford this luxury. They choose one provider, hope for reliability, and accept the risk that an outage means their business stops until service resumes. Monday's incident affected countless small businesses with no backup plan available within their budget constraints. Market ImplicationsThe outage raises questions about cloud provider concentration that have been discussed for years without meaningful change. Amazon, Microsoft, and Google will continue dominating the cloud landscape because they're the only companies with resources to operate at this scale globally. For investors, this concentration creates both opportunity and risk. The big three cloud providers benefit from network effects and economies of scale that make competition difficult. But regulatory scrutiny over market dominance could intensify if outages become more frequent or severe. The incident also highlights potential opportunities for smaller cloud providers focused on specific niches or geographic regions, though breaking the dominance of the major players remains extremely difficult. Why Nothing Will ChangeDespite the disruption, expect minimal structural change to cloud infrastructure concentration. The economics simply don't support it. Building and maintaining global data center networks requires enormous capital investment that only a handful of companies can afford. Amazon, Microsoft, and Google have spent billions creating infrastructure that smaller competitors can't match. Their scale allows pricing and service levels that make them effectively impossible to displace for most use cases. Regulatory intervention could theoretically force more competition, but governments have shown limited appetite for breaking up cloud services given the technical complexity and potential for unintended consequences. The Bottom LineMonday's AWS outage served as an uncomfortable reminder that the modern internet's reliability depends on the operational excellence of just three companies. While these providers generally deliver exceptional uptime, when problems occur, the impact cascades globally. For businesses, the incident reinforces the importance of disaster recovery planning, even if true multi-cloud redundancy remains financially out of reach. For investors, it highlights both the competitive moats protecting dominant cloud providers and the systemic risks inherent in concentrated infrastructure. The internet's fragility isn't news to technology professionals, but incidents like Monday's outage bring it into stark relief for everyone else. Until viable alternatives emerge—and there's little indication they will—we're all dependent on Amazon, Microsoft, and Google keeping the lights on. Slingshot Spots the Coil Before the SpringEvery explosive move starts as compressed energy. Slingshot detects that compression phase early. By the time it springs, you're in position. Spot the coil. Trade the spring. [Find the Coil] Stay ConnectedThank you for reading. I'll continue monitoring technology infrastructure developments and their implications for businesses and markets. Until next time, FindBetterTrades | 
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