Economies of scale refer to the cost advantages that enterprises obtain due to their size, output, or scale of operation, with cost per unit of output generally decreasing with increasing scale as fixed costs are spread out over more units of output. As AWS grows its infrastructure, it can achieve larger economies of scale, which in turn allows it to reduce the cost-per-unit of computing for its customers. Larger scale means AWS can negotiate better pricing for hardware, lower energy rates, and optimize maintenance, among other savings, that contribute to reduced costs for customers.