Don’t Let Your Data Sleep With the Enemy

At a February conference for online retailers, the founder of skin-care startup Beauty by Design, David Weissman, tried to kick off an insurrection. His rallying cry: Ditch Amazon Web Services, because the division’s profits help support Amazon.com’s e-commerce business, a direct competitor to almost every company present at the gathering.

The call to arms at the eTail West conference drew laughter, but it does underscore the quandary many retailers face as they weigh whether to keep buying servers and other computing services, or instead sign up with a cloud provider. Amazon’s “retail business is low-margin, and they make up for it with AWS,” Weissman says. “It’s very profitable revenue that’s being used to subsidize other businesses.” More companies want to move at least some parts of their business to the cloud, so they can handle extra-heavy sales volume around Christmas, Valentine’s Day, or other holidays, and to take advantage of the sophisticated data analytics many cloud vendors offer. While AWS is far and away the market leader, chief information officers at some retailers say they chose to go with Microsoft’s Azure, Alphabet’s Google Cloud, or IBM’s BlueMix rather than entrust important parts of their business to a rival.