Amazon, Google and Microsoft are fighting for a new battlefield

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When Amazon, Google and Microsoft all said they wanted to win all possible vertical market customers, the competition of the cloud services giants in the retail market became more and more interesting.

The Big Three’s reference customer list includes super-large retailers known to women and women who are trying to leverage cloud technology to improve their online and store customer experience.

The IT infrastructure of UK e-commerce sites such as Ocado, UK cosmetics Lush Cosmetics, Target and PayPal are hosted by Google Cloud Platform (GCP), while Microsoft Azure’s open customers include Marks & Spencer and UK retail. Brand ASOS and DixonsCarphone.

Amazon Web Services (AWS) also excels at attracting retail customers – UK veteran Sainsbury’s and convenience store brand Nisa use AWS technology, as well as many online retailer brands Shop Direct, high street fashion brands River Island and wine supermarket Majestic Wine.

Of course, compared to the Amazon online store, these are dwarfed. The Amazon Online Store is not only the largest retail customer on the AWS, but also the largest customer on the platform.

But for some retailers, Amazon’s relationship with AWS is so tight that they can’t trust their company’s applications and workloads to the cloud service giant.

Wal-Mart’s resistance
In June 2017, US retail giant Wal-Mart invented a statement clarifying a report in the Wall Street Journal that warned Wal-Mart to warn its technology partners to migrate hosted applications, workloads and data from AWS.

Wal-Mart responded, “Our suppliers have the right to choose any cloud service provider that meets their own and customer needs. We should not be too surprised for our tendency to move sensitive data out of our competitors’ platforms. .”

However, this response was soon “faced” by the party – Amazon’s statement, Amazon said that the former tried to “bringe” the way to ask suppliers to give up AWS technology, and the reason is also “unnecessary” – Amazon’s cloud service The business unit will “help the retail business department in some way.”

After the “spoof battle” one after another, Wal-Mart signed a multi-year cloud service agreement with AWS competitor Microsoft, and was also listed as a reference customer by the open source private cloud platform OpenStack.

When customers’ interests face conflict
Recently, AWS reference customer and Singapore retailer Trax Retail announced an increase in the number of corporate cloud service providers, including Google Cloud Platform (GCP), to spread the conflict of interest between customers to the table.

Trax Retail announced that it will develop data analysis software that assists retailers in designing store layouts and managing inventory levels using image data collected from store mobile terminals.

Earlier this month, the 2019 Retail Federation (NRF) conference was held in New York. David Gottlieb, head of US management at Trax Retail, was interviewed by Computer Weekly at the conference. “There is a peculiar situation in the retail industry, and some retailers are reluctant to use the technology ecosystem established by Amazon. Because they think there will be a competitive relationship with Amazon in the store sales.”

Trax Retail first publicly launched the Retail Watch program at the conference, helping retailers monitor the inventory levels of all items by installing a large number of customized IoT cameras on store shelves.

Trax Retail emphasizes that Retail Watch enables retailers to understand real-time changes in inventory, and its data processing business is done by Google Cloud.

“We have a franchise that works directly with mass consumer goods manufacturers,” Gottlieb said. “In the past, all system deployments were on AWS. Currently, we still offer AWS program deployment options for those manufacturers, but we are looking for new partnerships. Partner. Cooperation with GCP is very important to us.”

Multi-service provider, or single hosting?
Nicholas McQuire, deputy director of corporate research at CCS Insight, believes that adopting a cloudy service provider’s strategy is itself a way to address customer benefits, but it does not apply to everyone.

Most retailers are still in the early stages of digital transformation, and they can only take chances when faced with many different cloud service providers. But in the long run, this method is not practical and uneconomical.

McQuire adds that regardless of whether AWS offers more advantages than other potential competitors, retailers find it necessary to invest more in certain situations.

McQuire said: “Not just retail organizations, many companies adopt the strategy of a cloudy service provider, but if they really want to completely disrupt the market and restructure the organization, they may have to judge whether the cloudy service provider strategy is sustainable. This may remind Some companies have selected a preferred cloud service provider and worked closely with them because deeper collaboration with a single provider creates more economic benefits and innovation.”

Recently, there is a similar example. Cloud e-platform provider BigCommerce has moved more than 60,000 retailers using its services for online transactions from IBM’s Softlayer and AWS to GCP.

“Computer Weekly” has reported that BigCommerce used to rely on IBM’s hosted infrastructure clusters and used AWS cloud technology to handle traffic during peak visits, but now signed up for Google to address latency and performance issues.

“The decision to move to GCP is primarily driven by our customers, taking into account the location of them and their customers,” BigCommerce said in a computer weekly statement.

“Google is the only hosting provider of the global fiber and submarine cable network that it is laying on its own. This is very noteworthy because it allows all merchants to trade with customers as quickly as possible. We believe that Google’s infrastructure in the network is extremely Strong competitive advantage.”

Microsoft’s new retail abacus
At the 2018 US Retail Federation Exhibition, Microsoft announced a seven-year cloud service agreement with the drug company Walgreens Boots Alliance (WBA). In the United States and Europe, including the British high street chain Boots, Wobo United has many well-known pharmaceutical and cosmetic brands.

In 2014, the United States veteran pharmacy retailer Walgreens and the British drugstore chain and the United Botswana merged, the Wobo Union was officially born. Currently, Wobble has more than 415,000 employees worldwide and is committed to migrating the “most” IT infrastructure to the Microsoft Azure Cloud, and the company’s 380,000 employees fully use the Microsoft 365 online software package.

In the company’s news statement, Wobble said that the primary goal of the move is to help change the delivery of medical services to make them more user-friendly, user-friendly and affordable. Ed Anderson, deputy research director and well-known analyst of IT market watcher Gartner, told Computer Week that the importance of this agreement should not be underestimated, because many users choose this approach instead of going directly to the cloud or Move into the shared cloud.

Anderson said, “Azure and Microsoft 365 have won a big customer. It’s also a long-term commitment to innovate with leaders in the retail and healthcare industries that use Microsoft technology. It also shows that the future of Microsoft technology can be digitized. Transformation solutions. Although it is not certain what this long-term plan will evolve, the existing details are enough to highlight some of the interesting joint solutions that the deal will generate in the future.”

At the same time, retailer Amazon is also working together in its healthcare retail division, including the acquisition of online pharmacy PillPack.

A year ago, Wobble joined forces with financial services giant JP Morgan Chase and insurance company Berkshire Hathaway to improve the quality and economy of these companies providing medical services to US employees.

When Amazon began to gradually occupy the market of Wobolian, everyone would like to know if this has an impact on Wobo’s decision to fully select Microsoft cloud services.

Geithner’s Anderson said: “There is no doubt that many retailers are looking for technology providers outside of AWS because they feel competitive conflicts. This has led some retail organizations to choose Microsoft, Google and other cloud providers. AWS also attracts many retailers, so it’s not yet rumored that AWS will fail in the retail market.”

Geithner also expressed this view to the “Computer Weekly” through a company spokesperson. “In most Amazon retail friends, AWS is still very popular.”

An AWS spokesperson said: “Many retailers continue to choose AWS because they believe that the technology, agility, security and performance that every technology infrastructure platform needs should be top-notch. AWS is nothing in these areas. The leader of the dispute. Retailer users don’t care about other retailer rivals. In an era of rapid growth, end users only have to think about how fast the iteration of the customer experience is fast enough to ensure they trade with retailers. Speed ​​and ability are really important .”

Amazon wants to be friends with competitors
In fact, there are many examples of customer companies that are directly competing with AWS that are still using their cloud services. For example, streaming media service provider Netflix is ​​a long-term stable customer of AWS, and its core products directly target Amazon Prime Video products.

At this point, there are still things worth noting. In early January 2019, AWS also emphasized at the Internet Regulatory Hearings of the House of Lords Communications Committee that most retailers disregard their competitive advantage in order to sell their products on Amazon.com.

Based on data released by Lesley Smith, head of public strategy for Amazon UK and Ireland at the hearing, more than 50% of Amazon’s sales items are offered by third retailers, including retail merchants and flagship brands.

Smith explained to the committee that Amazon’s goal is to ensure that customers can buy “anything they want” online, and to achieve this goal, they need to work with these brands, not competition.

Smith said: “We want to be more advantageous and attract more customers, but it is not good for us to squeeze away from friends. I have never hesitated. We are not doing this now.”

In addition, Smith has shared some examples of how Amazon is helping retailers increase sales in the UK’s high streets – by introducing click and collect stores for Amazon products at local post offices and partners.

Smith added: “People don’t just house Amazon at home. They have a lot of choices.” In fact, many retailers are willing to work with Amazon.com to sell products or provide a place for Click and Collect stores because they believe in Amazon and Their interests converge. For AWS, this year’s focus should be on building an equal trust relationship with partner retailers.

CCSire’s McQuire said, “Foresight 2019, AWS’s important job is to build market trust, especially those vertical industries that Amazon’s retail organizations have been messing with. As the company deepens its digital transformation and service cloud in the future, it is the internal entity of the Amazon Group. How AWS can [become] a trusted platform for businesses.”

Regulatory challenge data source
Amazon and other giant technology companies have found a suitable working model under the close scrutiny of US and European regulatory authorities. Regulators have previously paid too much attention to whether the size and impact of technology giants will create an exclusive monopoly in their operating markets.

The issue was also discussed at the high-level meeting of the House of Lords correspondent with Amazon. At the time, Smith resolutely stated that Amazon was not in a dominant position in cloud services and online retail.

Since then, the EU Competition Commission has confirmed a preliminary survey of how Amazon’s retail platform uses merchant data, which began in September 2018.

When the House of Lords hearing questioned this question, Smith objected to allegations that Amazon Mall could use sales data from any third-party merchants that sell products on its platform.

Smith said: “We don’t have this privilege. Market sellers can see how products are sold, but our marketers can’t see sales data or any associated data about market sellers.”

Despite a similar statement, the hearing repeatedly mentioned a set of solutions for how to solve the Amazon impact and data usage problems – split Amazon.

However, McQuire does not believe that this move will significantly change the retailer’s view of the relationship between AWS and Amazon Marketplace. Even if a split occurs in the future, the supervisory authority should not be involved.

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