
Target is plotting a big move away from AWS as Amazon takes over retail - adventured
https://www.cnbc.com/2017/08/29/target-is-moving-away-from-aws-after-amazon-bought-whole-foods.html
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didibus
I don't know how strategic that move is in this case. It's not going to slow
down Amazon's retail growth, and it'll just cost Target more to transition.
They should have sound reasons to move away, like if they found cheaper and
better alternatives. I don't know, it feels a little desperate from my point
of view.

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bdcravens
It seems more defensive than strategic. Seems like you wouldn't want your
competitor to be your infrastructure provider and be in physical possession of
potentially differentiating assets.

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stupidcar
Don't want to because it hurts your pride, or don't want to because it has a
practical impact on your ability to compete in your actual market?

Amazon/AWS is not going to fail because Target took away their business. But
Target could easily screw up transitioning to another provider, and end up
paying a lot in terms of money and wasted effort. Money and effort that would
have been better spent improving their core business. Target should
concentrate on build a better retail business than Amazon, not worrying about
whether that business is built on top of AWS or some other cloud provider.

It's like how Apple compete with Samsung in the smartphone market, but still
relies on Samsung as a central component supplier for many of their devices.
I'm sure Apple execs would prefer not to give Samsung any money, but they're
also smart enough to realise that using only non-Samsung suppliers simply for
the sake of it would ultimately be a self-defeating move.

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meric
Amazon could also cut service to Target and it could take months for Target to
react properly through the courts.

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abraae
But when they eventually did, and proved that AWS had... targeted them.. then
the financial penalties and the loss of confidence would cause enormous harm
to AWS.

Which is why AWS would never do this in the first place.

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nickpeterson
Imagine the field day Microsoft's Azure Marketing team would have with that
revelation....

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mankash666
The article missed one huge factor: date farming by AWS/Amazon.

If one has data on pricing and sales across retail and online channels on a
national scale, how risky would a purchase of a retailer really be? Not much,
as you can pivot towards high sales, high profit products without doubting
your strategy

Target, Walmart & other retailers de-risked Amazon's purchase of wholefoods

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Gaelan
Do we know Amazon's policy on "peeking" into people's AWS data? I feel like
they would have something against that in their ToS/Privacy Policy.

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mankash666
They're the system admins on all their managed databases. Think about it

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linkregister
Not that Target is well-known to be good at security, but if AWS was
discovered snooping on their data that would probably be the end of their
business. Not to mention the tsunami of lawsuits launched by other companies
spooked by the scandal.

I can't imagine any manager or engineer willing to risk their career doing so.

Then again, a director at Volkswagen agreed to intentionally cheat emissions
tests, so perhaps an Amazon employee would be foolish enough to snoop on
Target's data.

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cm2187
I can't imagine an engineer creating a Diesel engine designed for fraud. But
it happened. I'd say that in a company with an aggressive business culture
like Amazon this is only more likely.

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origami777
What's the cost/benefit of them doing that to Target? On the upside they could
see what's selling well, what margins they have, etc. What's the net value of
that information to their retail unit? I'd say it's probably very small.

On the downside, they could lose their most profitable business unit.

Check out all the audits they go through. If you're an enterprise customer
with this concern you can get access to those audit reports and see if it's
one of the things being looked at by an independent third party.

Besides, all Target has to do is encrypt the data. Boom, non-factor.

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dx034
> What's the cost/benefit of them doing that to Target? On the upside they
> could see what's selling well, what margins they have, etc. What's the net
> value of that information to their retail unit? I'd say it's probably very
> small.

It doesn't have to be a careful CEO decision. It could just be a curious
engineer and someone in strategy who appreciates the data. That's probably how
it started at VW, not with the board deciding that this is a wise strategy.

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RijilV
Who remembers when Target's website was hosted by Amazon.com (not AWS)?
Probably 6 or 7 years ago now. IIRC Toys'R'Us was also but left earlier.

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jasonpeacock
[https://www.geekwire.com/2011/target-finally-parts-ways-
amaz...](https://www.geekwire.com/2011/target-finally-parts-ways-amazoncom-
retailers-web-site-launch-starts-outage/)

I remember when the new Target website launched, and they had a 'Credits' page
on the website (or a press release?) that listed over 50 partners that made
the launch possible, kinda crazy and not surprising that the website failed on
launch day.

Additionally, Target partnered with a popular designer to launch their product
line on the same day to celebrate the new website, adding insult to injury
with a huge traffic spike.

Their inexperience in operating a retail website was painfully obvious. For
example, the search results were accurate when really you want to optimize for
the customer experience and not accuracy - the first couple pages of search
results for an item were all the right items but also all out of stock, so it
looked like a very empty store as you clicked through page after page of
unavailable items. The search results should have sorted in-stock items to the
top by default.

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dx034
I don't understand the synergies of AWS within Amazon. Amazon.com is probably
one of the biggest clients, but probably not even the biggest. If they were to
split up AWS from Amazon, the entities could be worth more than combined. AWS
would lose restrictions of companies that don't like Amazon while Amazon.com
could still access the systems.

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smelendez
AWS generates cash and lets the rest of Amazon operate less profitably.
Investors are sufficiently impressed by Bezos's innovations (Prime, AWS
itself, Kindle books and Amazon Video+Music, recent price shifts at Whole
Foods) that they're willing to go along for the ride.

And I don't mean that necessarily negatively: they see Bezos as a visionary in
a market he's helping to define.

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jrpelkonen
Somewhat of a side note: Looking at the market share chart, I found it
surprising that IBM was substantially larger than Google. Although they lumped
IaaS, PaaS, and 'hosted private cloud' together, I still expected Google to be
well ahead of anyone else besides AWS and Azure. Can someone confirm the
accuracy of these numbers?

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smegel
If they are just doing this out of spite it is so silly. Do they think Amazon
is going to go broke now and pull out of retail?

If they are paying more to another provider, they are making themselves _less_
competitive in contrast to Amazon, although maybe Microsoft lured them with a
discount on Azure.

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tehramz
I don't think it's silly at all. Why help find another branch of a
competitor's business? Do you not think that Amazon doesn't use money
generated by AWS to help expand their retail business? I'm actually shocked at
the number of companies that use AWS even though Amazon is a direct
competitor. Netflix comes to mind.

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smegel
Yes but Targets contribution is hardly going to make that big a difference.

OTOH the cost of moving cloud providers, if significant, is going to be an
additional operational expense that would make them less competitive.

It's like Apple buying chips from Samsung.

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snowwolf
Previous discussion on Walmart doing something similar (vendors can't run on
AWS)

[https://news.ycombinator.com/item?id=14602836](https://news.ycombinator.com/item?id=14602836)

