Werner Vogels, Amazon's CTO, is talking about their Web services--specifically the outsourced data center products (S3, EC2, and SQS) that I've written about before and that were the subject of an IT Conversations interview I did with Doug Kaye and Jeff Barr.

Werner begins by making a case that (a) scaling is critical to Web businesses and (b) scaling, economically, is really hard. I was just twittering with Phil Burns last night about servers. He just took delivery of four for TagJungle. He's got a lot of work ahead of him setting them up. When TagJungle grows again, Phil has to do it all over again. Werner's making a case that small businesses shouldn't have that headache.

EC2 relies an Amazon Machine Images, virtualized machine images that you can create yourself (based on Xen) or simply download as a virtual appliance (see my earlier discussion of virtual appliances).

Someone (missed the name) from RightScale demoed using AWS for transcoding music on TuneCore. He shows how servers can be deployed and scaled based on demand.

Doug Kaye was invited up next to talk about the GigaVox system (GigaVox Audio Lite) that is the subject of my discussion with him and Jeff Barr. Doug is in the top 1% of AWS users in terms of the complexity and sophistication of his application. Doug says that the best part is that "no one's wearing pagers."

There's a very small upfront investment and the bill grows as you grow. There are no sudden capital spikes.

Werner recommends From Push to Pull- Emerging Models for Mobilizing Resources, a paper by John Hagel and John Seely Brown. I'll have to read it. Here's the abstract:

Not really an abstract: In the past decade, we have seen early signs of a new model for mobilizing resources. Rather than "push", this new approach focuses on "pull" -- creating platforms that help people to mobilize appropriate resources when the need arises. In lean manufacturing, early elements of a pull model began to emerge from Toyota in the early 1950's. As we will discuss below, however, lean manufacturing represents a hybrid between push and pull models -- it still contains significant elements of push models.