Amazon.com didn’t get into the business of selling cloud computing services to make money from excess capacity. That’s a myth. Even so, Amazon.com did get into the cloud computing business because it knew quite a bit about how to manage infrastructure at scale, and made a bold bet that it could become the center of cloud developers’ universe just as it was increasingly the center of the retail universe.
So why isn’t Walmart, master of a hyper-efficient supply chain, peddling access to its supply chain expertise?
Walmart still needs to come up with a credible answer to Amazon’s dominance online, but there’s a great deal of retail business that will persist offline in brick-and-mortar stores. Even Amazon recognizes this, and has been experimenting with offline retail.
Walmart, for its part, has been scrambling to innovate online, and most recently has been talking up an open-source Big Data strategy. This strategy involves open-sourcing tools that Walmart is building to move data from legacy tools into Hadoop clusters, and should be a boon to the countless others that will have similar data management needs.
It sounds like smart strategy, and it is. But it doesn’t get to the heart of what Walmart could, and perhaps should, be doing.
Back to Amazon. Amazon Web Services was never about selling Amazon.com’s excess capacity. That’s a myth, and one that Amazon CTO Werner Vogels rejects:
The excess capacity story is a myth. It was never a matter of selling excess capacity, actually within 2 months after launch AWS would have already burned through the excess Amazon.com capacity. Amazon Web Services was always considered a business by itself, with the expectation that it could even grow as big as the Amazon.com retail operation.
What isn’t mythical, however, is that Amazon understood web applications at scale, and knew how to build the necessary infrastructure to drive them. As Amazon CEO Jeff Bezos explains, Amazon both had the knowledge and the need to create this infrastructure for its own use, and figured it could then turn this into a serious business:
Approximately nine years ago we were wasting a lot of time internally because, to do their jobs, our applications engineers had to have daily detailed conversations with our networking infrastructure engineers. Instead of having this fine-grained coordination about every detail, we wanted the data-center guys to give the apps guys a set of dependable tools, a reliable infrastructure that they could build products on top of.
The problem was obvious. We didn’t have that infrastructure. So we started building it for our own internal use. Then we realized, “Whoa, everybody who wants to build web-scale applications is going to need this.” We figured with a little bit of extra work we could make it available to everybody. We’re going to make it anyway—let’s sell it.
Now think about Walmart. While Walmart’s tagline is (or was) “Everyday low prices,” with an emphasis on delivering reasonable quality for market-beating prices, the way Walmart achieves this is through its legendary supply chain. No one beats Walmart in terms of managing the process of filling shelves. As one commentator notes:
Basically Wal-Mart runs on an entirely different road than everyone else, a sort of information data superhighway. Wal-Mart knows literally everything that any retailer could ever want to know about one of its products. It’s been said that if the US was ever in World War III, the first thing to be taken over by the government would be Wal-Mart’s supply chain. It has THAT kind of performance power.
So if the supply chain is so good, why doesn’t Walmart “open source” it? Amazon recognized early that it could build a significant business by outsourcing its expertise in infrastructure. Why can’t Walmart do the same with its supply chain? And just as web application developers have crowded into the shadow of Amazon Web Services, I suspect we’d see an army of brick-and-mortar retailers of all sizes happy to tap into Walmart Supply Chain Services.
Ultimately, retailers aren’t in the business of supply chains any more than application developers are in the business of infrastructure. Walmart should be thinking of how to leverage its supply chain expertise to become the center of an ecosystem, and not simply the center of its own P&L statement.
And while I’m dispensing all this free advice, I’ll just add: Nodeable would be happy to track and analyze all the systems that feed into the supply chain, giving users a single pane of glass to see what’s happening throughout the supply chain. Because, hey! We’re generous like that. :-)
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Are we trying to fit square Hadoop pegs into round real-time holes?
Big Data is a big market, projected to top $16.9 billion by 2015, according to IDC. The Hadoop ecosystem, alone, is worth $1 billion per year, according to Forrester, and is set to explode by most accounts. What is less clear is for whom Big Data is big, and whether the workloads they’re currently running through Hadoop might not be best complemented (or, in some cases, replaced) with real-time analytics tools like Storm.
After all, given that 32 percent of Karmasphere’s survey participants are running Hadoop clusters smaller than 2 terabytes, and 55 percent are running clusters of 10 terabytes or less, the “Big” in “Big Data” really isn’t. Not yet, anyway. That will likely change as enterprises move from toe-dipping to diving into Hadoop and Big Data in a big way, but for now the workloads aren’t huge, and real-time tools like Storm might be ideal for managing them.
These workloads are also not necessarily being run behind the firewall. While both Cloudera and Hortonworks are booming due to enterprises keeping their Hadoop jobs running primarily in their data centers, Amazon is already managing in excess of one million Hadoop clusters with its Elastic MapReduce service. This is perhaps not surprising given that the majority of Big Data users tend to be business users, not hard-core IT people, according to Karmasphere’s survey. These people are apparently very comfortable having their data processed in the cloud.
Interestingly, while there are numerous great applications for Hadoop, the majority seem to be using it for marketing-related functions:
All of which brings me back to the point I made earlier this week: some data are best analyzed in real time, not batch. For many things, you’ll actually want both: a real-time view into what’s happening with your website, HR systems, etc., as well as a deeper, Hadoop-based analysis that is done in batch, after the fact.
Real-time analytics tools like Nodeable (based on the open-source Storm project) are not a replacement for Hadoop. They’re complements.
Given that so much of the data being analyzed with Hadoop are still relatively small and marketing-focused, not to mention being analyzed in Amazon’s cloud, I’d argue that more of today’s data, not less, should be run through real-time analytics systems, and particularly hosted systems. After all, while it’s useful to know how aspects of your online retail site are working hours or days or months after the fact, you actually want the “next click” to reflect real-time analysis, as Yahoo CTO Raymie Strata argues:
Again, this isn’t to denigrate the importance of Hadoop. At all. It’s simply to suggest that for many applications, relying on batch-oriented Hadoop alone is an incomplete strategy. Real-time is required for many applications, particularly those where Hadoop is being used today, and that real-time capability is delivered through Storm-based Nodeable or other real-time analytics systems.
It’s not Storm or Hadoop. It’s Storm and Hadoop.
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