Amazon Rebuilds Its Online Store Cloud as Power Runs Short

Amazon is reengineering the cloud infrastructure behind its massive online store as power and data center capacity grow increasingly scarce. According to internal documents obtained by Business Insider, the company is pursuing a multi-year project called Region Flex aimed at moving its online store systems away from concentration in a few major AWS regions, such as Northern Virginia and Dublin, and spreading them across more, smaller-scale regions.

The AI boom has triggered an industry-wide scramble for power and compute capacity. Amazon says it added more data center capacity for AWS last year than any other company, but even so, CEO Andy Jassy acknowledged last month that AWS isn't building capacity fast enough to keep up with demand. Internal documents show that those very industry-wide power constraints have become the main driver behind Region Flex.

According to one document, online store teams invested in pulling infrastructure out of the Dublin region to 'de-risk scaling' from AWS power constraints. Last year's plan called for cutting Dublin's online store infrastructure by 40% through migration and decommissioning during 2025, exiting Dublin entirely by the end of 2026, and exiting the Northern Virginia and Oregon regions by 2029. An Amazon spokesperson confirmed the Region Flex project to Business Insider but called some of the timelines and details in the internal documents 'inaccurate.'

Workloads are being shifted from Dublin to the Frankfurt and Zaragoza, Spain, regions. According to one document, moving some services from Dublin to those two regions could raise infrastructure costs by 10-15%, since spreading workloads out reduces hosting efficiency. At the same time, due to specific capacity constraints in the Zaragoza region, only 65% of the remaining infrastructure spend is planned to move there, with the other 35% staying in Dublin. Amazon estimated a one-time cost of $90 million for Region Flex in 2025.

The broader industry picture remains tight: according to CBRE, vacancy rates across major North American data center markets fell to a record-low 1.4% by the end of 2025. Jassy called power the 'single biggest constraint' and said demand would keep outpacing supply. 'Even with that capacity, we won't be able to meet all the demand for us in 2026,' he said, adding that he expects the same to hold true in 2027.