Lidl to Launch Rival to AWS(chargedretail.co.uk)
chargedretail.co.uk
Lidl to Launch Rival to AWS
https://www.chargedretail.co.uk/2020/05/11/lidl-owner-launching-its-own-rival-to-amazon-web-services/
501 comments
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...).
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.
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...).
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.
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.
- 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.
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.
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.
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&...
[2] https://camao.one/blog/partnerschaft-schwarz-gruppe-heilbron...
[3] https://www.lebensmittelzeitung.net/tech-logistik/Lidl-und-K...
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&...
[2] https://camao.one/blog/partnerschaft-schwarz-gruppe-heilbron...
[3] https://www.lebensmittelzeitung.net/tech-logistik/Lidl-und-K...
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.
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.
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.
"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.
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.
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.
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...
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...
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.
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.
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.
With enough capital and will they will get to somewhere. You can be sure the political establishment likely has their back.
"The acquisition, which completed on May 1, brings 70 cloud specialists into the wider group”.
For comparison, Amazon has 40,000 employees in AWS.
For comparison, Amazon has 40,000 employees in AWS.
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.
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.
Presumably this service will be available for a week or so, and then replaced by a selection of garden furniture and a welding helmet
I'll take "News headlines I did not expect" for $50, Alex.
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.
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.
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.
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.
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.
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/ [1] https://schwarz.jobs.schwarz/job/Neckarsulm-&-Umgebung-Cloud...
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/ [1] https://schwarz.jobs.schwarz/job/Neckarsulm-&-Umgebung-Cloud...
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....
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....
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
Unless they have some other cards they haven't played yet, this sounds more like a headline intended for investors rather than customers.
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.
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.
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!
It may well end up running on top of AWS!
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 $$ spends ? :)
Note this is purely out of curiosity..any links/blogs would be fine too :)
If you were the CTO/CIO and were tasked in building up a cloud that competes with behemoths , how would you do it. Of course it would be an "A Team" to do it , but what would be your priorities (e.g pick up cloud foundry and build things on top , take low hanging IaaS services) , there are so many aspects to it , how would you track progress and decide when to go out to market ? How would different teams (right from procurement , network , premises , to developers and ops personnel) be managed and seamlessly work ? What would be reasonable milestones and $$ spends ? :)
Note this is purely out of curiosity..any links/blogs would be fine too :)
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.
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.
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?
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...
[deleted]
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.
"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.
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.
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 :)