Amazon slashes costs after move to Linux

Online giant Amazon.com claims to have cut its technology costs by a quarter after shifting its back-end systems over to the Linux operating system (OS).

Yesterday's regulatory filing of third-quarter results revealed that the company spent $54m on technology, down $17m, or 24 per cent, from the same period the year before.

In the filing the company said that it had migrated a large portion of its technology infrastructure to a Linux-based operating platform. Amazon already uses a Linux platform for its front-end and web server OS.

The company is thought to be one of many moving over to the free OS to make savings in the downturn by dumping Windows, which is seen as the costly alternative.

And despite recent research from Ovum suggesting that the savings from moving to Linux are somewhat over hyped, Jeff Bezos, founder and chief executive at Amazon, insists that the savings are very real and that customers will benefit.

"We've lowered our operating costs 20 per cent and can now afford to drive growth by lowering prices for customers," he said. "If you're buying books over $20 from anywhere but Amazon.com, you're probably wasting money."

A report from the company directly attributed the decline in cash spent on technology to the "migration to a Linux-based technology platform that utilises a less costly technology infrastructure".

Warren Jenson, Amazon.com's chief financial officer, said: "We are pleased that our quarterly results were again in line with our guidance, and with our recent order trends.

"We continue to expect pro forma operating profitability for the fourth quarter and, while there are no guarantees, we are well positioned to achieve this important milestone."