Analysis / Contributed / Op-Ed /

Wal-Mart Kicks Partners Off Amazon’s Cloud: The Implications for Organizations

22 Jun 2017 9:41am, by

Phil Dougherty
Phil Dougherty is co-founder and CEO of ContainerShip, which makes the easiest way for you to orchestrate containerized applications and microservices across multiple cloud providers. Phil has been involved in web hosting and systems for over ten years, leading teams at New York City-based hosting companies, as well as the leading mobile commerce provider for retailers.

As first reported by CNBC on Wednesday, retail and e-commerce giant Wal-Mart notified some of its technology partners that they need to move their information assets away from Amazon Web Services if they want to continue doing business.

This move certainly comes as no surprise to many, as the two companies are long-standing rivals in their respective quests to dominate the world of retail.  It comes just days after the company’s CEO, Doug McMillon, told his company’s annual associates’ meeting, “Looking ahead, we will compete with technology, but win with people. We will be people-led and tech-empowered.”

For the technology partners and cloud service providers impacted, Wal-Mart’s “tech empowerment” move may be the first clear signal that their infrastructure should become cloud-agnostic.

The Return of White Box Deployment

The “on-demand, pay only for what you need, shut it off when you don’t” flexibility that cloud computing provides was pioneered by Amazon. It managed to hold a commanding lead over its competitors, who up to now have been looking to replicate its success in hopes of claiming their own piece of the cloud pie.

However, as AWS evolved, it became much more than on-demand virtual machines and storage. With dozens of automation tools helping customers more quickly deploy and manage their software, AWS created its own ecosystem. Once a customer locked itself into that ecosystem, it became nearly impossible to migrate away without a significant expenditure of effort and energy recreating the same services.

Wal-Mart’s notice to partners should be treated as a warning sign: If you are building and managing Web infrastructure, you had better plan and build in a cloud-agnostic fashion, or risk get caught with your pants down.

With AWS’ obvious benefits of faster go-to-market speed and low operational overhead, numerous organizations in both the public and private sectors stepped into the AWS quicksand.  They hadn’t thought much, if at all, about what they would do in the event that they would need to make their software scale and work properly somewhere else. By locking in to AWS fully, they may have gained DevOps superpowers, but they didn’t stop to consider what might happen if those powers were taken away.

Multi-Cloud Is No Longer Optional

For a great many operations managers and systems administrators, their organizations becoming cloud-agnostic used to be a pipe dream. With the state-of-the-art tools and technology available just a few years ago, it couldn’t have even been considered. Sophisticated configuration management and “baking” custom machine images for each provider were options, but they were error-prone, slow, and didn’t always account for the myriad of other supporting services and systems for monitoring, load balancing, firewalls and security groups, and storage.

This Wal-Mart move is music to my ears; it reminds me of a question I was asked by one of the judges at TechCrunch Disrupt Startup Battlefield, where I was presenting. “In my VC firm,” this judge said, “I have many portfolio companies that are using AWS. I have not really ever heard one of them have a need to move providers or use multiple providers. How significant of a need is there to be able to do this?”

Over the last two years, I believe the market has done a great job of answering that question. Wal-Mart’s notice to partners should be treated as a warning sign: If you are building and managing Web infrastructure, you had better plan and build in a cloud-agnostic fashion, or risk get caught with your pants down.

You might think it’s a hassle to adopt cloud agnosticism up front, but what happens tomorrow when it becomes a big deal? Think of all the integration points you have with your current provider, and imagine what you would do if you had to get everything moved right now, or else suffer from your revenue stream drying up immediately. That really doesn’t sound fun.

The New Options for Cloud Agnosticism

The good news is that there are options for starting out being, or quickly transitioning to become, cloud-agnostic.

Containerization has taken us a long way toward cloud-agnostic ubiquity and multi-cloud deployment for any size of company. Many engineers are working around the clock to build platforms and services that simplify the whole container deployment process. Reinventing the wheel and rolling your own solution is something you can do, or you can pick an off-the-shelf solution that will get you the whole way there for a very low price.

What Wal-Mart told its partners this week is the first of a series of conditions that will eventually become commonplace. While massive enterprises battle for market dominance, countries are enacting new restrictive legislation about hosting and data sovereignty. Suddenly, your business that worked just fine on AWS needs to work just as fine in a customer’s data center on the other side of the world.

My recommendation: Start swimming now if you want to catch the wave, or you might miss it and suffer the consequences.

Containership is a sponsor of The New Stack.

Title image of Wal-Mart Stores CEO Doug McMillon speaking at his company’s 2017 annual shareholders’ meeting, courtesy Walmart.com.


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