Monday, November 13, 2017

Kroger is using Google and Microsoft clouds to avoid paying Amazon

As Kroger turns to cloud computing, the country's largest supermarket chain is sending millions of dollars to Microsoft and Google.

But not to Amazon.

"For obvious reasons in a competitive way, it makes no sense for us to make a ton to help develop this business for them," said Chris Hjelm, Kroger's information director at CNBC in an interview .

With Amazon's retail activities growing in more industries and competing more directly with a growing number of businesses, Amazon Web Services is starting to experience a negative reaction. Kroger joins companies like Wal-Mart and Target to find other vendors who are processing their huge workloads for their digital and e-commerce offerings. Alphabet said in its latest earnings release that Kohl has migrated to Google's cloud.

In a blog post on Monday, GGV Capital venture capitalist Glenn Solomon emphasized how ubiquitous it has become. Solomon said retail customers have asked several companies in their company's portfolio to use AWS to "provide a duplicate service in another cloud because they would prefer that their data not be stored in Amazon given the fears of competition ".

For Kroger, this fear became more obvious by day. In August, Amazon bought Whole Foods for $ 13.7 billion and instantly cut prices overseas. CNBC also reported on Amazon's possible efforts to break the pharmacy market, another reason to worry Kroger.


Kroger gets about 9% of sales from its more than 2,200 pharmacies.

Hjelm said the company began investing heavily with Microsoft Azure and Google Cloud last year. With Azure, the merchant is launching a digital tablet technology combining the use of sensors and smartphones to alert customers about relevant offers. For e-commerce, delivery and data-centric initiatives, such as smart pricing, Kroger turns to Google. The company also uses Pivotal infrastructure technology.

Kroger has projects running on AWS for the companies he has acquired. But for any new initiative, "this growing investment is not going to AWS," said Hjelm. Regarding Microsoft and Google, "we think we do not lose anything from the point of view of competition with these companies," he said.

While AWS is concerned that Kroger represents an emerging trend, it does not appear in the unit's financial performance or market share.

In the third quarter, revenue grew by 42% to $ 4.58 billion, and AWS generated operating profit of $ 1.17 billion for a company that is used to operating with little or no benefits. Nordstrom, Under Armor, Lululemon and Nisa Retail in the UK are some of the retailers and mainstream brands that have AWS.



For the entire cloud infrastructure, AWS controls 34% of the market, followed by Azure with 12%, IBM with 8% and Google with 5%.

According to AWS, retailers will continue to use their infrastructure because they care more about agility, security and performance when deciding where to run their workload.

"AWS is the undisputed leader in these areas," said a company spokesperson in an email. "End users of retailers do not care about the rivalry that may exist with another retailer."

Like most large established businesses, Kroger does not move everything to the public cloud. The company still has many computing and basic storage functions in its own data centers.

But Hjelm said that in the cloud, Kroger has thousands of ongoing test and development projects, as well as live applications. He did not say how much the company spends on the cloud, but said it has millions of dollars and is roughly evenly split between Microsoft and Google.

"Over time, this balance could change depending on who creates more value," he said.

Tariq Shaukat, a president of Google's cloud division, said in an interview that even though retailers have been reluctant to give their money to Amazon, many of them have always been exploited on AWS. Google is now collecting customers because its cloud platform finally has the services it needs, he said.

"There is growing recognition that GCP is a viable option and a leader in areas that matter to them, such as security, data analysis and machine learning," he said.

Tuesday, October 24, 2017

HMRC's switch to AWS killed a small UK cloud business

DataCentred, an exclusive British minnow, filed for bankruptcy after HMRC, its biggest client, broke a service contract in favor of an agreement with Amazon, the company recently accused by MPs of tax evasion.

DataCentred, based in Manchester, has signed an agreement with HMRC there for two years through the framework of the G-Cloud: its infrastructure OpenStack manages a critical system in the tax department, a contract that has supported 85% of the DataCentred invoicing.

However, The Register may reveal that six months ago, the company was informed that the tax collector would no longer use its services because it reorganized the policy of being independent of the cloud to become an AWS fan.

DataCentred is not the only small cloud provider in the UK that has lost shares with HMRC as a result of the policy change. We know at least two more, although DataCentred appears to be the first direct victim

The company was founded by TeleCity founder Dr. Mike Kelly with £ 9 million funding from venture capitalist John Moulton and local authorities. The company returned £ 1.2m in 2016, but sank red after losing the HMRC contract and entered the administration in August.

Readers of Reg will undoubtedly discuss the weaknesses of being overly dependent on a single customer, but also the irony of seeing HMRC pay for the services of AWS, a company sometimes criticized for its fiscal efficiency. .

Since Amazon and Microsoft set up local cloud operations in the UK several years ago, leasing storage space to other vendors in the AWS case, some Gov.uk personalities seem to have surrendered. his rhetoric of SMEs, deciding to work with technologies. giants after all.

The registry also found that the Ministry of Labor and Pensions has a policy of only purchasing public services in the Amazon cloud, Google or Microsoft. We asked the department to comment.

While there are compelling reasons for this decision, the question also arises whether Whitehall is swapping a group of major IT providers, known as "oligopoly" by former cabinet minister Francis Maude. - for another.

Such a move also seems to make redundant the G-Cloud IaaS, which has been put in place to provide small cloud service providers in the UK a level playing field for short-term government contracts.

The registry asked HMRC how their decision was in line with the government's promise to award contracts to SMEs; Has the department risked creating a new lockout by doing so? and whether the ministry can be perceived as a reward for corporate misconduct, because Amazon has often been criticized for avoiding taxes.

An HMRC spokesperson said: "We have discussed our long-term plans to provide cloud computing and what is best for our customers.

"The hyper-scale cloud technology is available again in the UK and the increased capacity of the cloud provides more robust services at a significantly lower cost to the taxpayer."

The ministry stated that it makes decisions about its suppliers through a fair and open process, and in accordance with the rules of the public service. Regular financial and tax compliance audits will be conducted as part of this process.

The European Commission recently ordered Amazon to repay € 250 million (£ 222 million) for illegal and unfair state aid from Luxembourg.

The Amazon group denied receiving special treatment and paid the full amount of the tax in accordance with international tax laws and Luxembourg.

The company, headed by Jeff Bezos, has also previously said it pays for all required taxes in the UK and in all countries where it operates.

"The corporate tax is based on profits and not on revenues, and our earnings have remained low as retail is a highly competitive and low margin business and we continue to invest heavily.

Tuesday, October 10, 2017

While AWS and VMware Draw Closer, Amazon Still Looks to Dominate

AWS and VMware now are partners but it might be only a matter of time before AWS moves to take its own path.

The old days (and by old days I mean two or three years ago) were so much simpler. For those of us following the major public cloud vendors, it was an easy-enough task to classify the various players:

    Amazon Web Services (AWS) was the choice of the greenfield operations. Those that didn’t have any legacy to think about and simply wanted to leverage the most forward-looking public cloud.
    Microsoft Azure was for those organizations that were existing “Microsoft shops.” Not yet compelling for greenfield workloads, it was the bridge between the old and the new
    Google was for the cool kids – those whose primary focus was mobile applications, developer composability and the various other services that Google offers

All that has changed, however with all three players broadening their approaches to more generally cover the needs of both new and existing organizations

On AWS and VMware, a checkered history

Who can forget VMware CEO Pat Gelsinger's pitch to partners from a few years ago. A combative Gelsinger stated clearly:

"We want to own corporate workload. We all lose if they end up in these commodity public clouds. We want to extend our franchise from the private cloud into the public cloud and uniquely enable our customers with the benefits of both. Own the corporate workload now and forever."

Of course, this was back in the day when VMware still had its own ostensibly public cloud offering, vCloudAir. The company has since realized that taking on the big public cloud is a futile strategy and that it’s best hopes lie in helping its existing customers bridge their existing technology stacks into the public cloud.

This is somewhat ironic since VMware came to dominance as a company by making virtualization broadly available. As such, VMware had an integral part in making life unpalatable for the companies who made the bulk of their revenues by selling physical servers – IBM, HP and Intel among them. Virtualization, by allowing physical servers to be driven to ever-higher levels of efficiency and utilization, meant that less individual physical servers were sold. And now VMware was itself being disrupted by new approaches.

Sunday, October 1, 2017

Top Kiwi cloud expert swaps Microsoft for AWS


Amazon Web Services (AWS) has appointed Jaron Burbidge as senior executive of New Zealand, leveraging the cloud expert of Microsoft rivals.

By joining the market leader from Oct. 2, Reseller News can reveal that Burbidge is responsible for helping Kiwi customers seize the power of the public cloud by working with the most strategic countries strategy.

Prior to joining AWS, Burbidge managed engagements and alliances with Microsoft's major clients in New Zealand, as well as managing a local team of architects, account managers and cloud partners.

Throughout seven years at Microsoft, Burbidge has also been responsible for developing business in corporate cloud solutions, helping Kiwi organizations through the transition to the mid-market, enterprise and public sector market.

With more than 15 years of sales experience in the New Zealand and Australian markets, Burbidge has also held senior business development positions with IBM and Tandberg, having started with Canon New Zealand, Cogent, Visual Communications and Vantage Systems.

Burbidge's move comes as AWS continues to dominate the global infrastructure services industry as a service (IaaS), with 44.2% of market share.

But, as Reseller News said, the market leader could face stiff competition on the track if the rampant revenue growth rates of its three closest rivals remain uninterrupted.

According to the results of Gartner's research, Microsoft, Alibaba and Google seem to close, albeit by remote starting points.

However, in order to put the AWS market share in perspective, all other service providers in the IaaS cloud not included in the top five accounted for 41.2% of the world market share of $ 9.15 billion of US dollars.

At the local level, Burbidge is not the only top-level executive to join AWS in the past month, with Niall O'Gorman, director of the Nutanix A / NZ channel, also launching a new role in the cloud provider.

As stated in Reseller News, the move takes approximately 16 months after O'Gorman was appointed by Nutanix to manage hyper-convergence business chain activity in the local market.

Sunday, September 10, 2017

Alibaba Just Had Its Amazon AWS Moment

Since April 23, 2016, Amazon shares (NASDAQ: AMZN) have increased by 157%. It was no coincidence. That day, as part of the results of its first quarter results, Amazon broke for the first time its results from the Amazon Web Services (AWS) division.

The response from investors has been dramatic:





The amount of AWS revenue generated for Amazon has long been a source of speculation. Was the service, a cloud-based data management and storage service, even cost-effective?
The answer, as it turned out, was a resounding yes.
For the first quarter of fiscal year 2015, AWS generated revenues of $ 1.57 billion, compared with $ 1.1 billion for the same quarter in 2014. In addition, during these three years, AWS bought Amazon a profit in the first half of 2015 of $ 265 million with an operating margin of 17%.
Needless to say, Wall Street loved what it saw. Amazon, long known for its lack of interest in generating short-term profits, had built a fast-growing cash cow under the nose of Silicon Valley.
In the time elapsed, AWS continued to provide. In the second quarter of 2017, AWS sales amounted to $ 2.89 billion. A 42% increase over the second quarter of 2016. The division's operating income was astonishing 916 million dollars.
And that leads me to why Alibaba (NYSE: BABA) is so attractive today. As investors have learned, it has also created its own extremely profitable and cloud-based storage business.
Much gets even better
Alibaba's corporate results for its fiscal first quarter, reported on August 17, 2017, are not unusual. BABA reported adjusted earnings of $ 1.17 per share (effectively exceeding the estimated $ 0.92). Total revenues were $ 7.4 billion in the period, 56% more than in the same quarter last year.

 While the main headlines focused on the robust growth of e-commerce in China, a much more interesting data point was found in the report: Alibaba Cloud. While still in its infancy, department revenues increased almost 100% to $ 359 million.
For now, Alibaba Cloud is a small part of the technology giant's frontline, but since Amazon's past is an indication, this could become a significant part of the business and help the already strong margins of the company.
Even better than Amazon, and with a much wider potential market

It was noted that Aliababa had more in common with eBay than with Amazon. It serves as a marketplace for hundreds of thousands of retailers to reach consumers, thus avoiding the need to incur massive investment costs to maintain inventory in stores.

This does not undermine Jeff Bezos' remarkable success. Your business changes the way goods are sold (and delivered). Alibaba simply has a more profitable business model. In fiscal year 2016, Amazon's gross margin was 36%. Alibaba was 63.5%. With the addition of a cloud service like Amazon AWS, Alibaba's ability to generate profit in the next few years has improved.

With its shares at 34 times, earnings estimates from S & P Global Market Intelligence, Alibaba shares may seem expensive. However, analysts estimate that the Company's EPS will increase to 31% per year until 2022, when they believe the company will earn just under $ 14.82 per share. This compares with Amazon's earnings growth profile. Analysts who follow the company expect Amazon to earn around $ 3.50 this year and increase its profitability to $ 36.72 by fiscal year 2021.

Alibaba has just had its moment AWS Amazon. And, through the icing on the cake, it trades on a multiple of profit less than the company with which it compares so often. Wise Fools would do well to give Alibaba a strong consideration as a complement to its portfolios.

Thursday, August 31, 2017

Target is plotting a big move away from AWS as Amazon takes over retail

Target is struggling to compete with Amazon in retail, but finds other ways to defend itself.

The discount retailer reduces the use of Amazon Web Services, according to sources familiar with the issue, as the company aims to better control its infrastructure and stop funding its main rival. The purchase of Whole Foods by Amazon is the latest sign of the depth of growth of the e-commerce giant in all forms of retail.

Microsoft Azure is one of the cloud providers competing with nab Target Business Cloud, sources said, who asked not to be named because the plans are confidential. Google and Oracle are strengthening their cloud offerings.

Like all big box stores, Target is disturbed by Amazon, which is selling more and more expensive and faster. Target's annual revenues are lower than five years ago, although the company sold its credit card business and pharmacies during this period, and shares lost 23% Market Value in the last 12 months.

On Monday, Amazon finalized its $ 13.7 billion purchase of Whole Foods and instantly reduced store prices by more than 30 percent in fruit and organic meat. From electronics and household items to toiletries and grocery stores, Amazon is developing its inventory.

Although there is little Target can do to hinder Amazon's dominance in the retail trade, the emergence of other cloud vendors allows the company to spend its computing and storage funds elsewhere. According to a source, Target plans to aggressively change e-commerce, mobile development and operations away from the AWS until the end of the year and possibly until 2018.

A spokesman for Target said the company does not discuss the details of its dealings with vendors, but added that "we are currently using several cloud service providers and will continue to do so." An Amazon rep declined to comment.

Target hinted at its plans in October when the company said it had adopted an open source system called Spinnaker that Netflix has built to enable development teams to customize their clouds. A key component is that "Spinnaker was built to work with multiple public clouds compared to just one," Target said in an article posted on its website.

Target is not the only major retailer targeting AWS. The Wall Street Journal reported in June that Wal-Mart told its technology vendors not to run applications in the Amazon cloud and that for its own infrastructure the company uses a combination of servers and on-site services provided by Microsoft and others.

"If I use Azure or Google, I would go right after these guys," said John Vrionis, a partner at Lightspeed Venture Partners who supports the startup infrastructure. "I'm sure they could pack a convincing migration plan and these segments are probably very thirsty for it."

However, AWS has not yet seen a mass exodus.

In the second quarter, AWS controlled 34 percent of the cloud infrastructure market, covering Microsoft, IBM and Google combined, according to Synergy Research Group. Brands and stores such as Brooks Brothers, Nordstrom, Nike, Under Armor and Lululemon are AWS customers, although sources say many retailers are considering other cloud providers.

Tuesday, July 18, 2017

Dow Jones index – of customers, not prices – leaks from AWS repo

Dow emulated Verizon safeguard several internal databases (including Wall Street Journal subscribers) in the cloud, without adequately securing it.

The rape was revealed by Chris Vickery of UpGuard and detailed in this publication.

This is a very familiar and direct infringement: someone left a cloud repository set up to provide a 'semi-public access' meaning 'the personal and sensitive financial details of millions of corporate clients' exposed.

"While Dow has confirmed that at least 2.2 million customers were affected, the UpGuard estimates the number of 4 million accounts," the post.

The temporary assignment was an AWS S3 cube with the wrong privacy settings: configuring it to allow access to authenticated users, someone configured did not seem to realize that they were offering access to an authenticated AWS user - not just those with linked accounts - Jones Dow).

UpGuard said Chris Vickery discovers the infringement in late May (in other words, he was working on the rape before UpGuard has announced that he had joined them).

His analysis of the repository, called "Skynet-dj", since even system administrators for those who have a sense of humor and discovered rich.

There is a client file - which now claims to have more than 4 million disks - which includes "customer names, Dow internal customer identifiers, home and business addresses, and account data, such as the promotional offer in which a customer Has registered subscription ".

There is a database of risk and compliance filled with individual records, such as "a large financial sector staff located around the world" to less healthy individuals. Then from the UpGuard post, it is an excerpt that has the leading Libyan database Muammar Gaddafi.

Dow Jones confirmed the breach, but said successes such as The Hill, which was not serious enough to warrant a customer notice as passwords and credit card numbers have not been revealed (just enough data to mount a phishing or theft campaign Identity help). As for the "risk and compliance" files, the database contains only public information.

News Corporation, parent company Dow Jones, another troubled computer to defend today: Australia's pay TV operation Streaming video service Foxtel crashed when a wave of Game of Thrones was up to order new episodes. ®