
Lidl to Launch Rival to AWS - jpswade
https://www.chargedretail.co.uk/2020/05/11/lidl-owner-launching-its-own-rival-to-amazon-web-services/
======
benjohnson1707
Former Schwarz employee here:

The company made SO much money in the past 4 decades with big box / discount
retailing, you won't believe it. Salaries are off the charts (it would make
senior software engineers in SV look pale). Hubris is as well. The only thing
that drives reasoning are statements like 'we're not just some random company,
we're Schwarz Group'. It's the poster child Corp described by Andy Gorves
statement: Success breeds complacency, complacency breeds failure. Only the
paranoid survive.

At the same time, skill level did not take off so much. Just to give you some
insight: The Lidl online store team is not even aware of KPIs like CAC or LTV
or even how many new customers were acquired in a given year. And it's a
10-year-old unit (still burning millions per year) .

The whole corporation is basically a 2-person-empire (the only two people that
own shares and have taken the thing from 1 store to ~13k stores globally).
They make every major call, and even random minor calls. It should be
mentioned that they are 72 and 80 years old, respectively.

The Cloud idea very likely was acquired together with a former SAP cloud sales
VP. Here is the difference: Core Schwarz DNA is selling packed soup to end
customers at crazy scale, without even intervening in the whole process. Core
DNA SAP is large scale enterprise sales. Go read the Stratechery posting about
why Google failed with GCP to understand why Schwarz should not do this. When
I once mentioned this in a LinkedIn thread, I was urged by colleagues to
delete the comment because 'management did not like it'.

They are getting into the car sales and recycle business as well. Just to give
you an impression.

Interesting times though :)

~~~
paganel
> Salaries are off the charts

Just to add another data point, Lidl is also the retailer that pays the best
market salaries in the Eastern-European country where I live in (they actually
included that in several of their hiring ads), and I'm talking about shop
people like cashiers and the people that put things on the shelves.

> They are getting into the car sales and recycle business as well.

In here they've also opened a tourism agency that does quite well (or used to
do before the virus hit).

I agree though about the big difference between the German and US management.
I have a close friend that works at the regional Lidl HQ and she got
reprimanded just after being hired for having used the singular "you" (less
formal) instead of the plural "you" (I'm not sure how it translates into
German) when addressing herself to her bosses on the company's hallways (said
friend used to work for a big US company before moving to Lidl). She was lucky
though because not a week after her arrival there was a company-wide email
coming from the powers that be instructing the employees to use the less
formal singular "you" instead of the more formal plural "you", to which all
the employees in the company acquiesced.

~~~
wolfgke
> I agree though about the big difference between the German and US
> management. I have a close friend that works at the regional Lidl HQ and she
> got reprimanded just after being hired for having used the singular "you"
> (less formal) instead of the plural "you" (I'm not sure how it translates
> into German) when addressing herself to her bosses on the company's hallways

Using "du" instead of "Sie" for adressing people can be a very serious issue.
If you do this to a policeman, for example, you can be fined by typically 600
€ in Germany (source:
[https://www.bussgeldkatalog.org/beamtenbeleidigung/](https://www.bussgeldkatalog.org/beamtenbeleidigung/)).
To give an analogue in the English language: you wouldn't address your boss
with "yo nigga". So I believe the reprimand was rather rightfully.

A rule in the German language is: in doubt, use the more formal language
register. The "default language register" in German is typically "one register
more formal" than the "default language register" in English.

~~~
addandsubtract
Using the informal "du" over "Sie" is not _anywhere_ near using the n-word in
english. Raising your outstretched hand just above head hight to greet someone
would be, though.

Overall, using "du" is acceptable in 90% of social interactions. It's only
when talking to people in higher positions or as a courtesy to elderly /
unfamiliar people.

~~~
verylittlemeat
>Overall, using "du" is acceptable in 90% of social interactions. It's only
when talking to people in higher positions or as a courtesy to elderly /
unfamiliar people.

That is pretty much exactly how nigga is used.

~~~
unethical_ban
I don't think there is a mapping to this in English. I've studied some Spanish
and German - You learn about the various verb and pronoun forms based on
informal and formal "you". This is a part of the core language, the spec, so
to speak.

In English, there is no spec for different levels of formality. There is no
universally documented way to being less courteous to bosses and policemen.
Saying "sup dude" or "how's it going" is part of the American standard
library, not the language.

And to your point directly, "nigga" is incredibly informal and casual, and
would never be something anyone (much less a non-native speaker) should ever
use unless they know what they are doing. And usually, they should be black,
too.

~~~
verylittlemeat
Well it just so happens I am black and I've been using the word most of my
life.

Nigga is just "bro" or "dude" but exclusively used among black/minority
communities. I realize the word nigga is A Big Deal for white people but
really in our community it is used as casually as the word "like" in any given
sentence. Interestingly I have even used it with black bosses before in a
joking casual way.

~~~
oh_sigh
You're ignoring the fact that a non-negligible percentage of black people
don't want to be called any version of "nigga" by anybody, including other
black people.

The same is not even remotely true of bro or dude

~~~
verylittlemeat
You could say that for any informal familiar expression that makes the
recipient bristle.

It's so common people joke about it "don't call me dude, bro | don't call me
bro, pal" etc etc

~~~
oh_sigh
No, you couldn't.

~~~
verylittlemeat
As a black person among black people? Can, have and will continue to.

~~~
oh_sigh
Ok, cool. Good luck with that

------
40four
This quality of this article is terrible. It's very short (235 words), there
are no concrete sources, or solid evidence that this is real. This is nothing
more than speculation. Is this considered journalism is 2020?

Even more sad, is when you search and try to find better sources, and realize
that it's mostly just a few small, outlier publications, copy and pasting off
of each other. Business Insider unabashedly copy and pasted from Charged
Retail, and didn't even bother to format/ edit/ paraphrase anything. Even text
from the link to sign up for the Charged Retail news letter is in there
([https://markets.businessinsider.com/news/stocks/lidl-
owner-l...](https://markets.businessinsider.com/news/stocks/lidl-owner-
launching-its-own-rival-to-amazon-web-services-8852719)).

So the way I see this, there is no story here. This is not real news. This is
a rumor. Maybe even fake news. Nothing more, so let's stop talking about it.

~~~
SamuelAdams
This article is a textbook example of "news stacking" from the book "Trust Me,
I'm Lying" by Ryan Holiday [1]. Step 1, post some outlandish stories to random
blog posts. These blog posts are usually niche, and are run by some "experts"
with a core audience. They are trusted to be right.

Then that gets picked up by intermediary news sites like this *.co.uk domain.
Then it gets floated to social media, where it gets popular and noticed by the
big guns (NYT, Business Insider, Tech Crunch, etc) and then they just post the
same stuff. Then suddenly what was once a rumor becomes true.

[1]:
[https://en.wikipedia.org/wiki/Trust_Me,_I%27m_Lying](https://en.wikipedia.org/wiki/Trust_Me,_I%27m_Lying)

~~~
1MachineElf
NYT, Businesses Insoder, Tech Crunch, etc. can simply all report that there is
a rumor, and if they just do that often enough, society will treat it like a
fact.

------
SparklingCotton
Many good reasons why this would work in Europe.

\- Logistics in Germany is awesome, and Amazon really doesn't have a leg up on
the already existing logistics solutions there.

\- For a cloud provider, negotiating deals now when AMD is on the rise must be
perfect.

\- Beating AWS on EC2 pricing is easy. AWS EC2 pricing is insanely expensive.
German providers like Hetzner Cloud entered the market at 1/10th of the EC2
price.

\- A k8s-focused cloud provider gets an enormous number of already existing
k8s services without the need to compete directly with all the AWS services.

A "Hetzner Cloud" \+ K8S in Germany? I'd move all my stuff there.

~~~
ThePhysicist
We host a lot of our infrastructure on Hetzner Cloud and are very happy, but
to be fair it's a long long shot away from what AWS offers. You basically only
have compute, storage and networking, only three datacenters and two regions
to choose from and no managed services at all. You also can't do advanced
networking like announcing your own IP addresses (Hetzner only allows that in
colocation). You also only have a few instance types available, with RAM
maxing out at 32 GB and no GPU servers available.

Don't get me wrong I love Hetzner and their cloud offering and I think they're
doing a fantastic job, but it is not comparable to platforms like AWS, Azure
or GCP. It's good enough for simple use cases but I think most large companies
that want to switch from on-premise would have a hard time adopting it since
so many crucial features are missing.

The LIDL cloud will have the same problem I think: They will probably build it
on top of OpenStack or Kubernetes but will never reach feature parity with
AWS, Azure or GCP. I think in their niche (retailing, logistics) they might be
able to get some good adoption if they offer specific services and
infrastructure based on their own use cases and experience, but this isn't
really competition for AWS, at least not in the broader sense.

~~~
d33
> RAM maxing out at 32 GB

This part is just not accurate. I'm running their dedicated server with 256
GiB RAM right now.

~~~
karussell
For their dedicated servers you can have at least 712GB RAM.

But for their cloud offering the maximum is only 128GB RAM.

See [https://www.hetzner.com/cloud](https://www.hetzner.com/cloud) and click
on "dedicated vCPU". btw: do not confuse "dedicated vCPU" with dedicated
server.

~~~
ThePhysicist
I wasn't aware of that offering, thanks for letting me know.

------
bflesch
I've been to LIDL / Schwarz Group headquarters in Heilbronn last year, and
while they're a super young company with a vibrant atmosphere (which quite
unique amongst large German companies), IMO they are ultimately too much
attached to their legacy cash cows.

They are not streamlining retail processes because they earn too much money
with it. They have great IT talent, which is building fancy pilots all day,
but refuse roll them out because it will cannibalize their core business.
Their core business is keeping people in the store for as long as possible so
they buy more stuff.

On the logistics side, they have been the first large-scale retailer to
digitize the EUR-pallets (they have RFID-based plastic pallets) which allows
for some pretty fancy stuff.

They roll out their pallet processing tech at the suppliers' plant and have
logistics data in their systems even before it is loaded on the suppliers'
trucks.

~~~
ChuckNorris89
_> building fancy pilots all day, but refuse roll them out because it will
cannibalize their core business_

That's the big difference I've noticed between German and US companies.

In German companies if you are an exec that brought success to the company in
the past then your word is the law and focus is on keeping the status quo and
make sure that any new ventures don't make existing higher ups obsolete.

Whereas in US tech companies innovation is the primary focus regardless if
someone's division ends up obsolete and needs to be let go. Famous examples
being how Netflix pivoted from DVD rentals or Tony Fadell, creator of the iPod
who was tasked on delivering an iPhone prototype back in the day and failed as
his team's design was basically an iPod based phone which lost in favor of the
current iOS iPhone we all know today. During the live iPhone launch demo,
Steve Jobs deletes his contact from the favorites list basically saying
"you're fired" and the rest is history.

You won't see something like this in a German company where age and experience
in the company is more valued than being a visionary for future market trends.
That's why you'll never see the big German car manufacturers pull off a Tesla
even though they have more resources. Can't pivot and cannibalize the current
products and have to shit-can some famous higher ups that were successful in
the past.

~~~
redis_mlc
> Famous examples being how Netflix pivoted from DVD rentals

Not to nitpick your overall post, but let me explain the context better.

Netflix is named "Net flix" because the original plan was to offer a streaming
product ASAP, but investors and end-users weren't ready at the time.

So mailing DVDs was done initially, and because of a loophole in USPS pricing
rules, was a genius move when looking at cost. (Netflix historically has
employed a former Postmaster General to stay on top of that.)

Source: worked there, read a bunch of stuff on this.

~~~
eru
Do you have a link to a write-up on the loophole in the USPS pricing rules
somewhere?

Edit: I found a few articles. Seems mostly a lesson on how you shouldn't have
a government monopoly on the postal service in your country..

~~~
smnrchrds
I can't find the article. Would you mind linking to it?

~~~
redis_mlc
Adding to my previous comment.

The Netflix business model hacks were:

1) First class mail (cheaper than media mail packages for bare DVDs) with
likely letter-carrier presorting, volume and whatever other postal discounts
(hence hiring former Postmaster Generals) were available, plus an agreement
with the Post Ofice to manually sort DVDs to avoid machine damage using their
light-weight mailer:

"Bulk Discounts. First-Class Mail commercial pricing is available for
presorted letters, flats, and packages with a minimum quantity of 500
mailpieces. Automation discounts may also apply."

[https://www.usps.com/ship/first-class-
mail.htm](https://www.usps.com/ship/first-class-mail.htm)

See the 2000/2001 mailers for the prepaid first-class stamp:

[http://blog.dvd.netflix.com/new-dvd-releases/the-
evolution-o...](http://blog.dvd.netflix.com/new-dvd-releases/the-evolution-of-
the-mailer)

Also, if you get a tour of a main post office or sorting facility, you will
see bins labelled "Netflix", so DVDs get special handling and slightly faster
return delivery.

2) Because Netflix was the first adopter of #1 for DVD's, they won a ruling
that they could continue to use First Class pricing. (The Post Office tried to
move them to media mail which allows better packaging (at much higher cost)
for automated handling, but that was viewed as anti-competitive by the court.)

[https://www.courthousenews.com/post-office-cant-raise-
rates-...](https://www.courthousenews.com/post-office-cant-raise-rates-on-
netflix-mailers/)

(I used to be an expert in postal bulk rates around that time.)

3) First-sale doctrine allowing multiple rentals of the same DVD without
further payments to the studios. (Streaming requires payment per stream.)

[https://freakonomics.com/2013/03/22/a-brave-new-world-for-
co...](https://freakonomics.com/2013/03/22/a-brave-new-world-for-copyright-
and-the-first-sale-doctrine/)

For HN readers, I believe this is the first detailed analysis of both their
postage pricing strategy and first-sale doctrine in one article, likely
because few people know about both bulk mail and IP.

------
Cu3PO42
I'm currently getting a 500 on the link. Here's [1] an alternative source,
originally in German but put through Google Translate.

There's three things to note there: it's not Lidl itself, but the parent
company doing this, and the plans were announced late last year. Also they're
building out the infrastructure for internal use first and are not necessarily
looking to offer a cloud to customers, though they may work with select other
companies.

EDIT: I was able to load the original source just now and it claims that
following an acquisition they were now offering/planning to offer this service
to other retailers. I cannot find other sources (particular German ones)
supporting this claim. The blog of the allegedly acquired company speaks of a
"strategic partnership" and "investment" only [2].

EDIT 2: This [3] is the German source that the link on this post refers to.
Unfortunately it's paywalled. The abstract claims that the acquisition is a
"building block in building out their Cloud business".

[1]
[https://translate.googleusercontent.com/translate_c?depth=1&...](https://translate.googleusercontent.com/translate_c?depth=1&nv=1&pto=aue&rurl=translate.google.com&sl=auto&sp=nmt4&tl=en&u=https://app.handelsblatt.com/technik/it-
tk/schwarz-gruppe-mutterkonzern-von-lidl-und-kaufland-will-eigene-cloud-
aufbauen/25309556.html%3Fticket%3DST-1196336-geSLo7SoWOv1bffksFjl-
ap3&usg=ALkJrhiG-7wllaAXgcWaupAqkowHJhQHRA)

[2] [https://camao.one/blog/partnerschaft-schwarz-gruppe-
heilbron...](https://camao.one/blog/partnerschaft-schwarz-gruppe-
heilbronn/#english-version)

[3] [https://www.lebensmittelzeitung.net/tech-logistik/Lidl-
und-K...](https://www.lebensmittelzeitung.net/tech-logistik/Lidl-und-Kaufland-
Schwarz-IT-sichert-sich-Know-how-fuer-die-eigene-Cloud-146160)

~~~
ksec
If this is the case it would make more sense. Just a note your link is still
pointing to the same source.

~~~
Cu3PO42
Huh, that it did. I have legitimately no idea how that happened, other than
"copy paste shenanigans on my phone". I fixed it now.

------
ksec
If Hetzner ( Also from Germany ) cant / isn't competing with AWS, why does
Lidl thinks they can?

It then also mention _Delivery_ in UK, and _ecommerce projects_. Which makes
me doubt if the publication knows what AWS really is.

The whole piece ( If you can even call it a _piece_ ) is very poor reporting,
to the point I am thinking of should I be flagging this.

Edit: Please Read Comment by Cu3PO42
[https://news.ycombinator.com/item?id=23151233](https://news.ycombinator.com/item?id=23151233).

~~~
liberal_098
> If Hetzner ( Also from Germany ) cant / isn't competing with AWS, why does
> Lidl thinks they can?

Probably they want to repeat the success of AWS and apply the same pattern.
Their retail businesses will provide base load for the cloud. Their own
services can be developed in such a way that they can sell them to other
retailers as cloud services. Or they develop a market place and switch to
platform business.

~~~
jotm
Develop their own tools and get people locked in? Yeah, I don't see that
happening, unless maybe they lobby for further EU-wide Internet regulations
aimed at keeping US/foreign companies out.

[https://lobste.rs/s/wfltz1/eu_commissioned_study_proposes_eu...](https://lobste.rs/s/wfltz1/eu_commissioned_study_proposes_european)
Oh...

------
jonex
I doubt the headline properly captures their intent, the article itself is
very light on details, but this quote might shine some light at it:

"Lidl’s parent company Schwarz Group is taking on Amazon by launching its own
cloud computing service for third party retailers."

My guess would be that they are not aiming to compete with AWS per se, rather
to offer infrastructure and services for online stores, which could possibly
include having their own data centers for the service part.

~~~
qwe098cube
I would think so, too. Considering that Lidl is the biggest discounter with
around 11,000 branches worldwide, it might make sense for them to ditch AWS
and set up their own, independent infrastructure.

------
drawfloat
While the concerns over Schwarz Group's (because it is the parent group, not
'Lidl') lack of experience in the sector is valid, I do think some of the
dismissive reactions here underline a major risk to future competitiveness in
infrastructure providers.

Amazon is well established. Amazon has thousands of employees. Amazon does,
ultimately, provide a good service. But Amazon is also dominant, demonstrates
a callous disregard for worker rights in its other business arms, and has used
its solid AWS profits as a way to prop up its undercutting and dismantling of
other sectors.

Other businesses will not enter the space in as developed a state as AWS. That
shouldn't be used as a negative against them even trying. Otherwise, AWS is
only going to become more entrenched and the options for building at scale
will become more limited.

------
estsauver
I'm really confused why they think european data protection laws are likely to
be a big barrier. I think Amazon is well poised to let you choose regions for
things, and unless LIDL knows something we don't, will probably be able to
adapt to almost any new regulations as well or as fast as Lidl could.

I also wonder why I would trust LIDL to execute on a vital part of
infrastructure for us, when they can't manage an SAP migration project...

[https://www.consultancy.uk/news/18243/lidl-cancels-sap-
intro...](https://www.consultancy.uk/news/18243/lidl-cancels-sap-introduction-
having-sunk-500-million-into-it)

~~~
vertex-four
American companies so far have been _really bad_ at actually complying with
regulations like the GDPR - many do on the surface level, but if you're a
European company that wants to do things right and not take risks on the
interpretation of things like "consent", suddenly your pool of potential
third-party data processors drops significantly. There's a serious cultural
issue there.

~~~
mschuster91
> There's a serious cultural issue there.

Said "cultural issue" is the reason why the GDPR was implemented in the first
place! It was not European ad-tech running wild tracking people all over the
place so hard that even the notoriously slow and complex EU parliament had no
choice but to act in the interest of their constituents.

~~~
luch
Let's not kid ourselves : European ad-tech companies are not substantially
more ethical than their American counterparts.

GDPR (even with its current clumsy implementation) is a much needed piece of
legislation since the data processing market have no economic interest in
"behaving" ethically.

------
bashtoni
This sounds like a misunderstanding to me.

When you look at the details, it looks much more as though they're launching
an alternative to Ocado, a company providing technology for food retailers to
offer home delivery - they work with Kroger in the US.

------
fsloth
Europe, especially Germany, has this general consensus that EU needs it's
inhouse large cloud providers. So think about state subsidies, preferring
european partners and stuff like that.

With enough capital and will they will get to somewhere. You can be sure the
political establishment likely has their back.

~~~
luckylion
And Lidl/Schwarz especially has a strict No-Amazon-Policy. They see Amazon as
a competitor, so if you want to work with them on a corporate level, you must
not use AWS to process or store anything relating to their business. They do
make exceptions, but you better be prepared to make a hell of a case for your
product for them to reach up to upper management and ask for an exception to
buy your services.

And it makes sense, of course. If you rely on US-companies, you're dependent
on the US. Any political or economical conflict will result in Washington
pressuring US-companies and you'll be in a bad place. Given that most European
governments (and Germany's especially) are very unhappy with the current US
administration, it's obvious that they'd want to reduce dependencies.

~~~
oneplane
I still think it's weird that companies think this helps anything. AWS isn't
the same as the Amazon shop. Yes it shares the name and if you go enough
levels above management you end up with Bezos but other than that their
computers != their shop.

Sometimes people then point to the fact that it's still a US company but
ironically people try to make that point on their US-created computers using
websites on a US-owned gTLD with US-owned software. Generic cloud resources
seem like the smallest issue to me in that chain.

~~~
luckylion
Amazon said (to Congress, no less) that it does not let it's own team
responsible to deciding on which products to buy & sell access confidential
sales reports of third party sellers that use their platform. And then it was
revealed that they regularly do get access to these information.

There's no reasonable expectation that Amazon will not use any data it can
easily access to make decisions.

I don't find that your argument regarding "using US created computers" and
"US-owned gTLD" holds water. It's _very_ hard to build e.g. CPUs that will
contain very advanced backdoors that are totally hidden but can easily be
targeted remotely to gather information, and the same goes for secretly using
a domain. Additionally, the cost of doing so is astronomically high: the total
loss of trust in US chip makers and internet companies. They may very well do
that during major wars, but not to steal some company secrets.

On the other hand, it's easy for Amazon to siphon off data from AWS and even
just using meta data (e.g. looking at how and when a customer scales to what
size) gives you valuable insight into their business. And if they get caught?
A few politicians will be annoyed, a few media articles (but hey, they may
overshadow reports on unionization, so it's not all bad) and potentially a few
companies leaving their platform, while others will undoubtedly say "I have
nothing to hide from Amazon, so what?"

In other words the threat model is dramatically different.

~~~
oneplane
Sounds like a lot of conspiracy that isn't going be limited to Amazon so it
still doesn't make sense to single out their computing company. If you encrypt
your data on your public cloud (like you should), then no, the AWS retail
company cannot 'get' your data from the AWS Web Services company.

~~~
luckylion
Sure, Google or Microsoft might look at your stuff aswell - but why would
they? Neither of them are in retail so they aren't competitors. If you're
developing a new search engine that rivals Google, yeah, I wouldn't host that
on Google's infrastructure. Have a serious contender for Microsoft's money
cows? Maybe not put your code and issue tracking on GitHub.

~~~
oneplane
Both are definitely in to retail. The are not market places like so that is a
difference. (they both have physical and virtual stores where they sell both
physical and virtual products and both own-brand as well as third party)

If companies are afraid of other companies looking at their stuff they are
essentially going to have to reinvent everything themselves. What about
transactions, imagine someone checking what they pay their supplier and what
the customer is paying, that'd be scary. So now you can't use off-the-shelf
cash registers, banking services, ERP systems etc.

The only difference people are trying to see is that AWS and Amazon
Marketplace both have Amazon in the name. They don't have the same people, the
same building or the same anything, except the same Bezos at the top.

------
bigtones
"The acquisition, which completed on May 1, brings 70 cloud specialists into
the wider group”.

For comparison, Amazon has 40,000 employees in AWS.

~~~
saagarjha
Do they really? That’s an absurd number even by large company standards.

~~~
adventured
It's not absurd, it's undersized in fact.

AWS is nearing 50% larger than SAP in sales, which have 101,000 employees.

AWS is now approximately the size of Oracle in sales, which have 136,000
employees.

~~~
collyw
Where do you find numbers like that? It would be interesting to see other
companies.

------
slightwinder
I guess this is the result of their epic failed migration to SAP. They blowed
500 Million and 7+ years in an attempt to unify their IT on SAP, until they
realized it's just not working. I guess they then started building their own
solution, and bring now others into the round, which is kinda similar to how
AWS started. Amazon too started offering their extra resources to others,
until it grow into a business of their own.

I have my doubt, but I really hope this becomes something good. Good european
competition in that sector is quite neccessary. We have seen how european laws
influenced the world, and especially USA in the last years, hopefully business
can reach similar effects.

------
isthisnametaken
Presumably this service will be available for a week or so, and then replaced
by a selection of garden furniture and a welding helmet

------
breakingcups
I'll take "News headlines I did not expect" for $50, Alex.

~~~
sideshowb
I could swear I saw a cloud platform on the middle aisle last week but now I
need it it's gone!

------
jonahbenton
Sometimes I play a game with myself where I read the HN comments first, then
read the piece. It's like watching a game of telephone.

To my reading

a) lidl is NOT launching an AWS competitor, per se

b) this is all about the data and the power of the logistics platform

Amazon is heavy in the food business.

Amazon observes the use of any of its primitive services by any competitors to
determine where growth is occurring, then goes and eats competitor business.

Lidl will not use AWS, wants its supply chain to not use AWS, and would prefer
to have adjacent businesses use primitives (like distribution logistics) it
makes available so it can observe and eat them when time is right.

Walmart already two years ahead in this game.

~~~
tyingq
_" It's like watching a game of telephone"_

It's not really a mismatch of the comments and article though. The title of
the article is _" Lidl owner launching its own rival to Amazon Web Services"_.
And the body says things like _" While Schwarz IT intends to use Europe’s
enhanced data protection laws as a key differentiator to Amazon’s dominant
service"_.

So perhaps you're right about the true purpose, but the article is claiming
otherwise.

~~~
jonahbenton
Yes- I didn't make the point well, but that's the point.

The game of telephone goes like-

* there's what I would guess to be reality * the things the article says, that distort from (what I would guess to be) reality * the things the headline says that distort from what the article says * the things most HN commenters who only read the headline say that distort yet further from the article and from reality

By reading some of the top HN comments, and then the article, I get to play
this game backwards. This was a particularly good example.

I don't doubt that Lidl is building some platform for retailers and its supply
chain to use. That's just good business.

And no doubt data protection plays some role in the strategy, though data
protection is a right generally afforded individuals, and Lidl's focus will be
commercial.

But these two paragraphs are particularly out of proportion:

    
    
        Schwarz Group, which owns both Lidl and Kaufland, is launching its own rival to Amazon Web Services (AWS) following the recent acquisition of software specialist Camao IDC
    
    

and

    
    
        The acquisition, which completed on May 1, brings 70 cloud specialists into the wider group representing key “resources in an important area of digitalisation”.
    
    

AWS probably hired 70 people in a couple of hours yesterday, dwarfed by Amazon
as a whole, which probably hired 5,000.

------
KingOfCoders
For some time now I think why Hetzner is that weak? We've used them in my last
Startup and their cloud offering was fine (price, quality), but to use them
one would need loadbalancers and managed Postgres and some caching We managed
that on our own but it felt unnecessary. AWS has a lot of bells and whistles
not every one needs, but there is a set of tools you need to operate a
website. I currently use DO who are very slow but get there I think.

~~~
icebraining
Not everyone needs to compete in the same market. There are some EU providers
moving in that direction (e.g. OVH now offers managed Kubernetes, block
storage, load balancers, etc), but Hetzner is very useful if you don't need
that stuff.

------
rjknight
This seems sufficiently unlikely that I wonder if something has been lost in
translation.

My guess would be that Lidl does expect to do something innovative in
e-commerce (around, say, augmented reality) and is planning to offer that as a
service to other retailers, hence the comparison with Amazon's strategy. I
can't believe that Lidl is planning to compete with S3 or EC2.

~~~
onion2k
It's Lidl's parent company that's launching the service, after buying a cloud
provider. The headline is just stupid. It's equivalent to an article titled
"Whole Foods runs AWS".

~~~
luckylion
No. Whole Foods is one of many Amazon ventures, but not the most significant.
Supermarkets (Lidl and Kaufland chains, mostly) are the main business of
Schwarz Group.

It's more like saying "Google will do X" when it's technically Alphabet that
spawns X.

------
Hir0ki
They aleady have a Website [0] for the cloud Platform.

By the looks of it they want to start with a managed K8s and database
services.

If you look at the job offers, you can see that they are using OpenStack[1]
for some parts of there platfrom

[0] [https://stackit.de/en/cloud/](https://stackit.de/en/cloud/) [1]
[https://schwarz.jobs.schwarz/job/Neckarsulm-&-Umgebung-
Cloud...](https://schwarz.jobs.schwarz/job/Neckarsulm-&-Umgebung-Cloud-
Infrastructure-Engineer-%28wmd%29/573464801/)

------
lowercased
Someone else mentioned 'hubris' here. We had a Lidl open up near us 2 years
ago (in the US) - generally good store with good prices. Nice size. We were
looking forward to more. We saw where they'd opened some of their stores, and
couldn't figure out the justification - some locations just seemed odd. Read a
few months later that they were 'scaling back' US development, and new build
stores would be about half the size of the one we got (which... isn't huge).
They couldn't hire regional people to help them find better locations?

Their inventory system seems out of whack - the stuff we buy regularly will
just ... vanish, never to come back. We've been shopping and heard others
complain of the same thing - sometimes the same items we were looking for (and
had used to buy).

Their in store bakery was initially great - for about a week, then scaled back
and rarely has anything fresh - regardless of time of day. You can tell
if/when there's been some regional VP to visit that day because the bakery is
hot/fresh/piping that day, then... offline. Now... many US folks in grocery
stores may not be used to 'good bakeries', and perhaps it was a money loser
for them, but... they didn't really give ours a chance to develop with the
local shoppers in the first place. Give people more than 2 choices of bread -
do it for a month or two, to give people time to try out options, get a
rhythm, etc. Buying something, liking it, then coming back 3 days later for
more and the bakery is effectively 'closed'... doesn't make you want to come
back.

I wish they'd focus more on better in store inventory/stocking before moving
to be an AWS-killer....

~~~
asynch8
Lidl's MO is focusing more on being cost-effective for both the consumer and
themselves rather than the brands

------
CiPHPerCoder
I don't want to sound dismissive, but I don't think their acquisition is going
to be enough for them to compete with AWS.

[https://www.camao.one/de-de/referenzen](https://www.camao.one/de-
de/referenzen)

Unless they have some other cards they haven't played yet, this sounds more
like a headline intended for investors rather than customers.

~~~
patagona
Yea, the german link above doesn't even mention the acquisition and the german
source for the english article ("Lebensmittel Zeitung") doesn't talk about
"cloud specialists" either. CAMAO IDC are software developers (who know how to
use the cloud), not "cloud specialists" in the sense that they know how to run
a cloud provider.

Source: I work there

------
sethx
Didn't Lidl just burn 1.x Billion on a new failed SAP backoffice tool, and now
they're getting into cloud hosting? OH MY GOD.

------
pantulis
Well it's only the journalist who is talking about a "AWS rival". What if Lidl
could come up with a cloud architecture specifically tailored for the
challenges that any brick and mortar retailer has? I'm talking about pre-built
solutions for real time stockage, logistics, integration with common ERPs,
etc.

It may well end up running on _top_ of AWS!

------
cocoland
As a novice engineer , i would like to ask the larger community few view point
questions just out of curiosity.

If you were the CTO/CIO and were tasked in building up a cloud that competes
with behemoths , how would you do it. Of course it would be an "A Team" to do
it , but what would be your priorities (e.g pick up cloud foundry and build
things on top , take low hanging IaaS services) , there are so many aspects to
it , how would you track progress and decide when to go out to market ? How
would different teams (right from procurement , network , premises , to
developers and ops personnel) be managed and seamlessly work ? What would be
reasonable milestones and $$ spends ? :)

Note this is purely out of curiosity..any links/blogs would be fine too :)

------
tekkk
I am sceptical but I applaud their effort. If Google has trouble competing, it
wont be easy for Lidl either. Yet having a true European option with enough
low prices and reliable engineering could work. From my experience retailers
dont often have the engineering expertise to pull these kind of things off,
but with a culture that empowers developers instead of keeping them as puppets
of the managers, they might manage to find and keep good talent.

I hope they at least embrace open-source options and easy billing management,
to counter-act the greediness of AWS-way of doing things. Competition in this
area is definitely a good thing for all the customers.

------
abhisuri97
Ignorant American here who has never heard of Lidl/Schwarz Group before. Is
there anything in their history that would show that they know how to do
compute? Is their infrastructure right now really solid/better than AWS?

~~~
Jnr
Who could forget their SAP failure two years ago.
[https://www.computerweekly.com/news/252446965/Lidl-
dumps-500...](https://www.computerweekly.com/news/252446965/Lidl-
dumps-500m-SAP-project)

~~~
hobofan
That was also the first thing I thought of when I read the headline.

Might have been a wake up call for them to put more resources into IT and make
it a core competency in the future.

------
Zenst
I suspect that this may of came about due to the cancelation of a half a
billion SAP migration and need to update their own internal systems.
[https://www.linkedin.com/pulse/lidl-cancels-sap-
introduction...](https://www.linkedin.com/pulse/lidl-cancels-sap-introduction-
after-spending-500m-euro-andrea-cravero)

------
runj__
In Sweden Lidl is know for being suspiciously cheap, they're even playing on
it in their ads here. They had a marketing stunt where a chef started a luxury
pop-up restaurant and the payoff was that it was all Lidl ingredients.

"You can cook good food EVEN though you're using Lidl stuff"

I'm not 100% sure that's what I want of a cloud provider.

~~~
gbrindisi
Sidenote: as an italian in Sweden I wouldn't dismiss so fast the quality of
some stuff you can find in Lidl compared to Coop, Ica or Hemkop.

Lidl reputation as a brand has gone up for me since I moved here.

~~~
mongol
Agree. I am Swedish and have shopped at Lidl (not exclusively) for perhaps 10
years. In the beginning it was mostly poor people I could see and the parking
lots half-empty. Now I see much more varied clientele and more cars outside. I
have a distinct feeling that many that avoided Lidl before do not now.

------
durnygbur
Lidl and Kaufland stop delivering flyers and leaflets to my place in Poland.
First - this is not Germany and we don't waste papper left and right for any
formal and informal, solicited and unsolicited communication. Second - I don't
want your papper spam, I don't want any spam in any form really.

------
ThinkBeat
I welcome more non-American owned or hosted companies in this space but going
from practically zero to take on AWS is a heck of a long way to go,and would
require enormous amounts of capital.

Hopefully, they can stat out with offerings that are especially attractive for
European retailers or something like that.

------
scandox
Didn't Lidl abandon a 500 million SAP integration recently? I mean perhaps
this kind of failure is part of their motivation, but it certainly seems like
a leap.

I'm certainly hoping a major European player emerges in cloud but it would be
an impressive diversification in this case.

------
sidcool
I think the article intends to convey that Lidl is launching some cloud
products to compete with a smaller segment of AWS. I would not think it's
possible to challenge AWS or Azure (may be even GCP) for the next 5 years.

------
fergie
There's definitely more of an opportunity in EU cloud services than you might
think.

I work for a pretty big EU university (~50000 users) and there is very little
AWS/Azure/Google we can actually legally use. And this isn't a case of
"bureaucracy gone mad" either, there are some real concerns with the big cloud
providers that the rest of the world doesnt seem to have the time or the
energy to tackle.

Another thing is that AWS/Azure/Google are getting _super_ complex. The idea
of a back to basics cloud provider that fully complies with GDPR might
actually be a compelling offering.

That said- whether this kind of tech can come from a budget supermarket chain
in Germany is another thing all together. Despite the hype, not much
exportable tech actually comes out of Berlin, and its not clear that they have
the breadth and depth of expertise in "open source at scale" to make this
actually happen. But on the other hand- who knows? Will be interesting to see.

------
supermatt
I dont think this is about AWS. The company they mention that was acquired was
a web/marketing agency, providing solutions based on 3rd party CMS platforms -
not a datacenter/ops specialist.

------
joyj2nd
This may work and may be much cheaper than the overpriced Amazon AWS, since
Germany does not pay her people well. Most salaries are are a fraction of US
salaries. This is the main reason for the exorbitant and quite bad trade
surplus of Germany, who exports both, goods AND capital.

Lidl has not quite a big reputation for IT:
[https://www.consultancy.uk/news/18243/lidl-cancels-sap-
intro...](https://www.consultancy.uk/news/18243/lidl-cancels-sap-introduction-
having-sunk-500-million-into-it)

------
makkesk8
> many have expressed concerns that AWS cash reserves and low prices could be
> major obstacles in securing clients.

Low prices? Seriously?

------
zeruch
This is like a weird parallel of Fry's getting out of the grocery biz in
California and selling electronics instead.

------
Vosporos
If they are as cheap as their transport management system (which required
Silverlight), nothing good can come out of this.

------
nprateem
Hopefully this means I'll be able to rent a blowtorch and an air compressor
and only pay for the time I use it.

------
MaxBarraclough
Wonder if they'll offer ARM servers. Might make sense if they're serious about
competing on price.

------
atlgator
The author doesn't realize AWS is for more than just ecommerce making the
comparison highly suspect.

------
barrenko
I'm pretty sure they could do it, on a German-speaking scene, which is
sheltered in and of itself.

------
doener
This is not was the original source says (in German and behind paywall:
[https://www.lebensmittelzeitung.net/tech-logistik/Lidl-
und-K...](https://www.lebensmittelzeitung.net/tech-logistik/Lidl-und-Kaufland-
Schwarz-IT-sichert-sich-Know-how-fuer-die-eigene-Cloud-146160?crefresh=1)).

It is not clear if the cloud will be publicly available for customers and
therefore a rival to AWS.

------
agsilvio
When all we want is for them to put the Parkside cordless jigsaw on sale.

------
daralthus
This is the same Lidl who spent €500m on a failed SAP rollout, right?

------
jillesvangurp
I work in Germany currently. Big German companies have a lot of bad reflexes
in common when it comes to doing big IT projects and it's a reason for a lot
of companies failing repeatedly in this space because they have the wrong
focus and assumptions.

One of those reflexes basically boils down to combination of ineptness and not
invented here (i.e. in Germany) syndrome. Another part of this is that the
locals have an understandable historical aversion against anything invading
privacy; as this has been abused by both nazi's and communists to hurt people
in the past.

Unfortunately the net result is an industry that is still dependent on
shoveling around a lot of paper via post and fax (!!), and a misguided trust
in the security of what is basically a patch work of small companies,
corporate departments, and government agencies working with very outdated,
home grown stuff that can only be assumed at this point to be quite insecure
and hopelessly compromised by foreign and domestic intelligence agencies at so
many levels that you might as well print the stuff in a newspaper.

Most customers you talk to almost right away start assuming they can't use
AWS, Google cloud, or Azure for legal reasons. Of course, all of these run
data centers in Germany where they comply with applicable law to keep their
quite many German customers across basically all industries happy. This is a
complete non issue from a technical and legal point of view. Also, the likes
of IBM, SAP, and Oracle are happy to take your money for running this for you
(at great expense).

Yet, I've had this discussion with several naive startup founders where they
are going to build X and of course from day 1 are going to do their own
infrastructure as well because it's obviously the right thing to do (for
them). Most of these startups die young. Most bigger German companies get
burned repeatedly by this stuff as well.

I know at least one billion dollar construction materials company insisting on
running their own cloud that are sinking obscene amounts of cash into running
things in a convoluted way. There's no shortage of local suppliers preying on
this type of behavior. I declined working on their pile of steaming manure.

LIDL just burned 0.5 billion with a local IT supplier (SAP) that milked them
for the fools they are on a project that they should have pulled the plug on
years ago. That's all you need to know about their level of competency in this
area. Saying this is doomed to fail is just stating the obvious.

------
callamdelaney
Perhaps they should think about an online store first?

------
Bayart
Headlines you never expected to read.

------
tewwi
Too Lidl too late? (sorry)

------
archgoon
Huh; I would have pegged Walmart to try this first.

~~~
archgoon
... this was a serious point. Walmart has invested significantly in it's own
infrastructure

[https://www.investopedia.com/news/walmarts-new-weapon-
agains...](https://www.investopedia.com/news/walmarts-new-weapon-against-
amazon-cloud/)

And regularly stipulates SaaS providers that it contracts with to not use any
AWS resources. Stipulating that they use their service in future is likely the
next logical step.

My pardon, I assumed that this was common knowledge; though it would appear
that their branding is so terrible that this is assumed to be a joke.

------
redis_mlc
I've come across a bunch of startups in SV with the premise of competing with
AWS.

Pretty big mountain to climb.

~~~
fsloth
The resources Schwarz group has are quite large. Also, EU has zeigeist that
they _need_ their own massive cloud providers.

So think it as a new flavour of Boeing vs Airbus, if you will. Hopefully with
not so many state subsidies.

~~~
enitihas
How large are their resources? Keep in mind we are talking about clod
computing here where the big 3 themselves should be doing 60-70 billion
dollars in sales yearly, so large has to be relative to the Industry.

~~~
est31
According to Wikipedia, Schwarz group had revenue of €104 billion in
2018/2019, while Amazon had revenue of $280 billion in 2019. The employee
count of Schwarz group is 429k while for Amazon it's 840k.

So Amazon is double in size _overall_. It's not an impossible thing for them.
That being said, I think their current ambitions are more limited by just
running their own infrastructure.

[https://en.wikipedia.org/wiki/Schwarz_Gruppe](https://en.wikipedia.org/wiki/Schwarz_Gruppe)

[https://en.wikipedia.org/wiki/Amazon_(company)](https://en.wikipedia.org/wiki/Amazon_\(company\))

------
megaframe
I don't get how they plan to compete, do they have chip designers? or deals
with SOC manufacturers because AWS/Google/Microsoft are fast because of custom
chips that link NVMe directly to the NIC and skip the CPU and some of the
network stack

~~~
INTPenis
This is clickbait. That's why it says Lidl instead of Schwarz Group. Everyone
in Europe knows Lidl and find it amusing that they would run a cloud service.
Which means they'll click the link.

In reality it's a major german business group who plans to get into IT
services with a recent acquisition. They have none of the experience that AWS
or GCP have acquired in the last 6-10 years.

They'll do their best and I honestly hope it works out because I want to see
more European cloud providers compete with american ones.

~~~
londons_explore
Plans to get into IT _logistics_ services.

If you want a database tracking how many potatoes are in which trucks and when
they'll arrive, they'll sell it to you. If you want a Kubernetes cluster, that
isn't their business.

