Lidl to Launch Rival to AWS

https://www.chargedretail.co.uk/2020/05/11/lidl-owner-launching-its-own-rival-to-amazon-web-services/

by jpswade • 6 years ago

459 501 6 years ago

chargedretail.co.uk

breakingcups• 6 years ago

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

sideshowb2• 6 years ago

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

abhisuri97• 6 years ago

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• 6 years ago

Who could forget their SAP failure two years ago. https://www.computerweekly.com/news/252446965/Lidl-dumps-500...

hobofan2• 6 years ago

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.

puszczyk• 6 years ago

They are a very popular discount (I guess a bit like Walmart, but this is not a 1:1 analogy). The article mentions cloud for the retailers and 70 cloud specialists. It think this is far from AWS scale and judging by the article I’d expect they (will) offer services for European retailers rather than general purpose global cloud.

They are good in their core business, and I’m sure this means logistics, marketing, etc. but does it translate to potential operational efficiency in cloud infra I honestly don’t know. It may, but I wouldn’t hold my breath.

hotgeart• 6 years ago

European (BE) here, no. They are just know for being cheap stores and have time to time crazy promo on an limited article. You can't even rly do all of your groceries there. Unless you only eat frozen chickens, chips, soda and vegetable cans.

Their website is slow af btw (4s to display a detail page).

So if they want to do an AWS like. They'll need to invest. Its not like Amazon : hey we've a bunch of unused servers why we don't rent them?

hobofan2• 6 years ago

hey we've a bunch of unused servers why we don't rent them?

That's not the origin story of AWS. That myth has been debunked numerous times.

redis_mlc3• 6 years ago

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

Pretty big mountain to climb.

fsloth2• 6 years ago

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.

enitihas2• 6 years ago

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.

runj__• 6 years ago

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.

rumanator• 6 years ago

You don't want for a cloud provider a world class service that is cheap?

Eikon• 6 years ago

Lidl is not world class, it’s just cheap.

paganel2• 6 years ago

Amazon was mostly still a book-seller when they first launched AWS, stranger things have happened. For what it’s worth Lidl has a respected IT presence in the Eastern-European capital city where I currently live, I know that they invested quite heavily in that area for a few years already.

mirciulica• 6 years ago

They own most of the brands. The production facilities are in Eastern Europe (mostly Poland) so they take advantage of cheap labor and huge volumes.

nutjob2• 6 years ago

Suspiciously cheap? I love to shop at Lidl because they're great value for money. Quite often the quality is better than more expensive supermarkets but at a much lower price. Also by and large they're very consistent.

They fulfill the adage that "you don't need a lot of choices, just one good choice."

decentralised• 6 years ago

I wonder if the self-deprecation might be a corporate branding thing? In Portugal a couple of years back there was a "marketing war" where one retailer's message went something like: "smart people buy with us" while Lidl's ads expressed something like "you don't have to be smart to buy at Lidl".

barrenko2• 6 years ago

That is literally something Amazon could do.

qxfys• 6 years ago

Lidl is also my first choice in Sweden when it comes to supermarket. It does not make sense for me to pay 30-50% more of my money to a relatively same product from COOP or ICA.

Imo, they're already good at the supermarket business. I am wondering, instead of doing something out of their expertise, why they do not try to focus and beat other players in their core business. I think there are plenty of areas that can be improved. Having only 70 army and try to be on par with AWS is preposterous!

gbrindisi• 6 years ago

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.

mongol3• 6 years ago

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.

mikorym3• 6 years ago

I come from an agricultural background and all of the farmers I know always get less than 50% of the price of what you pay in the supermarket. Change that 50% to >80% and you get Lidl and Aldi for the exact same produce.

I am not sure why it works like that. These days you get direct to supermarket more often (taking out Fresh Produce Markets) but again—it's not direct to consumer. Personally, I think it's more because of the retailers being cutthroats than any other reason.

mschuster912• 6 years ago

Personally, I think it's more because of the retailers being cutthroats than any other reason.

It's rare that supermarket chains have direct contracts with farmers. Usually there are one to three middle men in the chain that all want their cut - on the farmer side a cooperative or other association (e.g. with milk it's common that a milk processor buys the milk from the farmers and then sells the processed milk on), then wholesale markets, and finally cooperatives on the supermarket chain themselves - for example, the supermarket chain "Edeka" actually not only runs their own stores, but also is a cooperative of independent store owners, as their name "Einkaufsgenossenschaft der Kolonialwarenhändler" reflects.

Reason077• 6 years ago

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

Just like in the supermarket industry, there is plenty of demand in the market for quality products at cheaper prices.

I remember the early days of AWS where they would surprise us with price cuts every 6-12 months. That hasn’t happened for a long time, which suggests to me that AWS is, over time, taking advantage of their dominant position and getting more greedy with pricing. Just like Amazon itself!

archgoon2• 6 years ago

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

archgoon2• 6 years ago

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

https://www.investopedia.com/news/walmarts-new-weapon-agains...

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.

bigtones• 6 years ago

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

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

gibolt• 6 years ago

Surely it can't be that many. And if it is, that has to include janitors at their data centers.

cameronbrown• 6 years ago

Sure it can. Also, a lot more engineers are required to take a product to market at a big corp than a startup.

9nGQluzmnq3M• 6 years ago

I'd wager a guess that less than half of that is engineering (At Oracle the sales:engineer ratio is around 3:1.)

discodave8• 6 years ago

Several of the larger AWS services are at multi-hundred person engineering org headcounts.

EC2 has thousands of engineers by my estimation. Source: I worked thete.

There are 200+ AWS services now. So just 8 engineers (2 pizza team) for each service would be 1600 engineers. Let alone marketing, enterprise sales etc.

speedgoose4• 6 years ago

They will probably not attempt to compete against AWS on everything but focus on the core cloud technologies using off the shelf software and hardware. An alternative of EC2, S3, and ELB is already interesting and many companies provide that with fewer employees.

No need to waste resources on products such as AWS Greengrass, or AWS Lumberyard, or even AWS EKS.

discodave8• 6 years ago

Just EC2 networking (VPC) is several hundred, maybe 1000 employees.

My guess at the total headcount for EC2 would be several thousand employees.

Source: worked as an engineer at Amazon, including EC2 for 5 years.

eb0la3• 6 years ago

I am betting they will provide only: - Block + Object storage (can be done with off-the-shelf hardware). - Compute instances - VPC networking. - Kubernetes (o k8s-managed services). - An open-source database. Probably postgress.

saagarjha2• 6 years ago

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

voz_• 6 years ago

Its not so crazy if you think of every AWS product as its own med-large startup... That being said, that is a rather large number in terms of absolute company size.

discodave8• 6 years ago

Yes.

Source: worked at Amazon for 5 years, including EC2.

WrtCdEvrydy• 6 years ago

Amazon plans to hire at least 200,000 and have a target of 85% of all workloads on AWS by 2050.

adventured• 6 years ago

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.

discodave8• 6 years ago

Looking up "Amazon Web Services" on LinkedIn, and going to the "people" tab gets you 50k people in 2020.

So maybe you're even underestimating!

mediascreen• 6 years ago

Doesn't that include anyone who has ever worked for AWS?

estsauver2• 6 years ago

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...

vertex-four• 6 years ago

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.

mschuster912• 6 years ago

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.

Eduard• 6 years ago

US companies will comply, knowingly or unknowingly, to US government requests for handing out data, no matter GDPR and data center location within EU.

oblio3• 6 years ago

Both the Patriot Act and the Cloud Act apply anywhere in the world.

markvdb• 6 years ago

I rather see them cancelling SAP as a positive sign. They seem to know what they are doing...

estsauver2• 6 years ago

They cancelled their SAP integration after dropping 500 million euros...

It might be a sign they're moving in the right direction, but it also tells me they are transitioning from a board and executive team that felt that was the right path quite recently.

gridlockd• 6 years ago

Cancelling SAP is a sign that they can avoid sunk cost fallacy, which is good.

CiPHPerCoder• 6 years ago

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.

patagona2• 6 years ago

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

eb0la3• 6 years ago

70 people is not much for, except for a vertical solution. If they can sell/co-host big warehouse management like Manhattan at a fraction of AWS, they could succeed.

jonex• 6 years ago

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.

qwe098cube2• 6 years ago

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.

discodave8• 6 years ago

Sounds more like Shopify maybe.

Zenst• 6 years ago

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...

Cu3PO423• 6 years ago

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...

ksec2• 6 years ago

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

Cu3PO423• 6 years ago

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

qwe098cube2• 6 years ago

here is an archive http://archive.is/yICx0

dna_polymerase3• 6 years ago

The Camao website/announcement is available in English: https://camao.one/blog/partnerschaft-schwarz-gruppe-heilbron...

Cu3PO423• 6 years ago

Thanks, I didn't release there was an anchor for the English version, I updated my link.

patagona2• 6 years ago

Not saying Schwarz (the parent company) won't try and run their own cloud provider, but I doubt the acquisition has much to do with that at all.

Also, the german link above doesn't even mention the acquisition and the german source for the english article (from "Lebensmittel Zeitung") doesn't talk about "cloud specialists" either.

CAMAO IDC is a software development company (who knows how to use the cloud), they're not "cloud specialists" in the sense that they know how to run a cloud provider.

Source: I work there

Semaphor2• 6 years ago

It’s German, but here is the Heilbronner Stimme [0] article the Handlesblatt references. It says Schwarz Gruppe bought 90% of Camico IT, but they’ll keep the name and 50% of their work will be what they did before.

[0] https://www.stimme.de/heilbronn/wirtschaft/2018/schwarz-grup...

rjknight• 6 years ago

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• 6 years ago

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".

luckylion5• 6 years ago

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.

imhoguy• 6 years ago

LidlCloud?

fsloth2• 6 years ago

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.

luckylion5• 6 years ago

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.

oneplane4• 6 years ago

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.

ksec2• 6 years ago

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.

liberal_098• 6 years ago

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.

jotm2• 6 years ago

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... Oh...

dvfjsdhgfv• 6 years ago

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

Hetzner has a completely different business model and so far it has been working very well for them. They are good at optimization of all their available resources via flexible pricing. As their loyal customer for almost 10 years I love one their aspect that I hate with AWS: with Hetzner, I'm 100% sure how much I'm going to pay at the end of the billing period. Actually, for several of my customers I turned on yearly billing as the amounts are so ridiculously small.

raverbashing• 6 years ago

If Hetzner ( Also from Germany ) cant / isn't competing with AWS

This makes as much sense as saying "So if Digital Ocean (also from the US) can't compete with AWS, who can?"

They're different niches

dna_polymerase3• 6 years ago

Hetzner runs hosting, which ultimately is an administration feat. AWS is above that an engineering feat. Different operations and you would have to hire entirely new people, and I think Hetzner's model still has its appeal.

barrenko2• 6 years ago

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

drawfloat• 6 years ago

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.

bashtoni• 6 years ago

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.

bflesch4• 6 years ago

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.

barbecue_sauce3• 6 years ago

I've only been to Lidls in the US, but their stores seem pretty streamlined to me.

forkerenok• 6 years ago

I think GP means that they are unwilling to open up their logistics mojo to other efforts in fears that it would interfere with their well-run retail operations.

dna_polymerase3• 6 years ago

In Germany, their store managers do inventory manually, which means they have to order items they run low on, no tech insight. Their attempt at setting up SAP failed after burning 500 million on it.

Delivery robots, Amazon-style prototypes for cashier-less systems, heck, even Instacart like delivery are nowhere to be found. If Amazon decided to enter the German supermarket landscape, Lidl (also, Aldi and others) would be in serious trouble.

ChuckNorris896• 6 years ago

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.

jotm2• 6 years ago

They are more conservative.

Blockbuster, Sears.

VW, BMW.

lowdose2• 6 years ago

It's the typical innovators problem you describe and that is pretty international. I do think you have a point about culture and in Europe in general software engineering is not seen as such a value adding activity as in the US. Salaries are less than $100k even in senior positions and

I think because of this more talent has moved to the cutting edge technology companies in the US than Europe wants to admit.

redis_mlc3• 6 years ago

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.

asjw7• 6 years ago

The other big difference is that German companies prefer stability over pure profit, because it creates a better working environment and a happier society overall, where your job doesn't depend from sheer luck, especially the lower income ones.

They pulled out more Tesla's than Tesla will ever do, and they still rank on top of the carmaking industry.

Tesla, on the other hand, the first thing has done when they bought Grohmann Engineering was to stop the production for competitors, that led the founder to leave.

That's never a good sign for an established business.

That's the price you pay for having a "humanly deficient man" as a CEO.

neuronic5• 6 years ago

There is a notable exception to this role: Germany's e-commerce giant Otto [1] has transitioned from order by catalogue to webstore pretty well and they are doing some nice things techwise.

Maybe exception to the rule but definitely an example of not being stuck in the past and it's a LARGE corporation.

[1] https://www.otto.de/

fragmede• 6 years ago

That seems overly stereotyped. North American companies that fail to innovate do so at their own peril. They languish, and eventually become irrelevant. Kodak, Sears, RIM (Blackberry) come to mind. So do the non-Tesla US car companies. General Motors, Ford Motor Company, and Fiat Chrysler Automobiles.

megaframe• 6 years ago

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• 6 years ago

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_explore4• 6 years ago

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.

benjohnson17073• 6 years ago

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 :)

ljf• 6 years ago

I was running a stall at a graduate careers fair and was amazed at the interest both Aldi and Lidl were getting.

Both had amazing starting salaries - I think Aldi was £48k rising to £70k over 3 years if you went on the area manager scheme. Plus a car. The teams there were so enthusiastic and energised and appeared to really really enjoy their jobs.

I am impressed by any company that consistently looks after their staff financially and otherwise.

valzam• 6 years ago

I don't have firsthand experience but from what I know those salaries come with very high expectations. Things like "you have to drive to some random neighborhood on a Sunday to check that flyers were being delivered correctly'.

paganel2• 6 years ago

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.

occamrazor• 6 years ago

I guess you mean the 2nd person form (du or ihr fir singular or plural) instead of the 3rd person plural (Sie), which is the courtesy form fir singular and plural.

Yes, in German it’s a big deal, roughly the same as saying “Hey dude” instead of “Good morning Mr Smith”.

andarleen2• 6 years ago

I hear a lot of horror stories about German management working at Cluj Napoca’s tech companies, and beyond. If left unchecked they will continue doing so.

ido5• 6 years ago

This is very old-fashioned & I guess geographically dependent: we used to live in Vienna where you'd expect to use Sie (formal) with any adult you don't personally know where as we now live in Berlin where everyone uses du (informal).

Either way nobody who isn't an asshole will get a non-native speaker in trouble for mixing these up & even in Austria my experience was that they will just be a bit perplexed but continue speaking as if the "du faux pas" didn't happen.

wastedhours2• 6 years ago

Tu vs voi?

LargoLasskhyfv9• 6 years ago

Another data point from Lidls homeland regarding the wage of the "shop people" from about 10 years ago. While we had endless political discussions about minimum wage there were numbers of 7,50EUR to 8,50EUR per hour in the air at that time. Don't remember exactly anymore. What i DO remember though is that they had signs in the shops which you couldn't miss when standing at the cashier. They read 10EUR per hour, and later 11 to 12. They don't do that in shop signaling anymore, but nowadays it is around 15EUR i believe, while other retailers/discounters pay significantly less, except ALDI. And we still have that discussion over a mandatory minimum wage in all sectors, and it is ridiculously low.

_the_inflator• 6 years ago

German in Management here.

This "Du/Sie" thing is a local shit test in Germany in my opinion. Comparable to what I experienced in strictly hierarchical enterprises like Sony US in the early 2010th, where at least one Senior Manager would only talk to an employee directly, instead only to her senior manager (same level BS).

Informal is owning the workforce finally, it is on the rise, and you can use it as a shit detector. People who value hierarchy over merits will refer to these manners. Others not. :)

wolfgke4• 6 years ago

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/). 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.

znpy• 6 years ago

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.

Just to add another data point: in the small town when I come from (southern italy) the Lidl store was a total failure and a complete mess. They acquired land built the whole building, opened short of staff, operated briefly (always short on staff and with a huge turnover) and then had huge problems with (afaik) the legality of the contracts for employees and allegedly employee mistreating.

That Lidl store didn't last long, to put it nicely, and the building is still on sale many years after that.

AdmiralAsshat• 6 years ago

I'm sure anyone who works for a Japanese company would understand. The class/power dynamics are built into the language itself, and in most situations it is not socially appropriate to respond to your boss in the same "register" as they might address you.

Bayart3• 6 years ago

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"

Sounds reasonable. If someone did the same to me in a professional setting my instinct would be to treat it as an intentional lack of respect. Albeit my language is French (but it functions the same as German in that case).

dirtnugget4• 6 years ago

German here. I absolutely loathe the formal form. It can be compared to using "Sir" with your superiors. While it is super common to address people informally in younger IT companies, in more traditional ones it is mostly informal.

If they talk formal, run. It's most likely a shithole.

This level of formality between people I find very patriarchal and outdated. Also, with people you just met it becomes somewhat awkward to always ask for which formality to use. English is doing very well without it.

stx• 6 years ago

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)

Are Germans usually this strict about language in a professional setting? I am from the USA but worked for a company with offices in Germany for a couple years. They were formal in some ways but also made many jokes that could get you fired in the USA. Maybe my experience was the exception.

asjw7• 6 years ago

Salaries are off the charts

Are they?

I received few offers from them and their salaries where in par with what I earn in Italy (around 100k) which is very good for Europe but not as much as SV

ChuckNorris896• 6 years ago

Just out of curiosity what do you do that earns you 100k in Italy if I may ask?

Most Italians I met working in Austria and Germany left Italy because of low salaries and they're not making anything close to 100k here either.

I've even met Italians who moved to Eastern Europe for higher tech salaries than back home so something doesn't add up.

chx2• 6 years ago

Stratechery posting about why Google failed with GCP

I believe you meant https://stratechery.com/2019/the-value-chain-constraint/

moonlgn• 6 years ago

I worked in the Real Estate Dept at Lidl for a (very) short time, awful company. Never have I seen people being treated so badly, especially in stores.

Their IT was an absolute joke back then, we had to use a 20-year-old ERP and most of the work was done on paper. Thinking that these guys could take on AWS sounds ludicrous to me. However, they are cost-killers and hyper-aggressive when it comes to selling, so this might even work...

odiroot• 6 years ago

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

They were also supposed to get into housing.

StreamBright5• 6 years ago

> 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 a crazy scale, without even intervening in the whole process. Core DNA SAP is a large scale enterprise sales. Go read the Stratechery posting about why Google failed with GCP to understand why Schwarz should not do this.

This is exactly what I have guessed. Many people think that replicating AWS is just the question of money. It is not. Most of the great datacenter people are hired by AWS, MS and Google. These are the guys who can think of cost efficient reliable solutions, quite often inventing new things in the process that the outside world has no idea. I was watching countless videos while working for Amazon about the data center tech. Mind blown, every single time. I seriously doubt that the Schwarz group will be able to attract the talent to replicate this. Many of the AWS guys are life timers, do not care about money. What is a more likely scenario that they will burn through a few billion EUR before realizing that they know nothing about cloud computing and cut their losses.

It is going to be interesting to watch though.

jawns• 6 years ago

Many of the AWS guys are life timers, do not care about money

I've heard, anecdotally, that Amazon/AWS engineers tend to be more money-driven than others in the same tier, or at least they're willing to put up with a lot more headaches because of the money.

Is that a misconception?

If not money, then what keeps them there?

TulliusCicero5• 6 years ago

Salaries are off the charts (it would make senior software engineers in SV look pale).

I have a hard time believing this, given that senior engineers at places like Google or Facebook are making 300k+.

dubcanada• 6 years ago

According to https://www.comparably.com/companies/lidl/salaries/software-... and glassdoor senior software engineers are around 150k to 200k and directors are around 200k to 300k.

So they are largely comparable to SV salaries at Google/Facebook. Which means since Google/Facebook pay more than average, they are above average for SV.

And that's at places like Berlin which are cheaper to live than SV.

_pmf_• 6 years ago

they are getting into the car sales and recycle business

To be fair, the recycle business is basically "free money" in Germany.

k__2• 6 years ago

"skill level did not take off so much"

Big problem in German enterprise.

They don't have any IT skills, but much money and are constantly crying for "digital transformation" what usually only leads them to being conned by big consulting agencies.

bencw• 6 years ago

Why is this? Is there a brain drain going on?

eru33• 6 years ago

Interesting! I would have expected competition with eg Aldi would have kept them on their toes?

IshKebab• 6 years ago

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.

Sounds very similar to Dyson. The biggest problem is that nobody wants to make decisions because what's the point when James Dyson is just going to come along and casually overruled it? Especially frustrating if it's something he isn't interested in.

scandox• 6 years ago

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.

SparklingCotton• 6 years ago

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.

kleiba• 6 years ago

Right. Plus, let's not forget the legal implications for the companies that will be able to keep their data within Europe.

Torwald4• 6 years ago

This is big. And it can only grow with future legislation. This could tie in to security measures and standards in the future. We will see what happens, but it is a strategic advantage as for now.

jdietrich• 6 years ago

What legal implications? AWS customers can choose to keep user data wholly within the EU regions, or they can transfer data freely between EU and US regions thanks to Amazon's certification under the EU-US Privacy Shield framework.

One of the great strengths of AWS is their phenomenal compliance department - whatever regulations you're subject to, AWS offer tools, guidance and support to help you maintain compliance. That's one of many, many reasons why AWS is simply incomparable with cheaper cloud offerings from smaller providers.

https://aws.amazon.com/compliance/programs/

eb0la3• 6 years ago

Also, retailers don't like AWS. For them using AWS is gifting money to your biggest natural predator.

montenegrohugo• 6 years ago

Wouldn't they have the same situation with LIDL? LIDL is also a (very) successful retailer, other retailers would have little incentive of helping them make more money.

Also, I'm quite surprised about this announcement. I knew LIDL was in a really good position, but to attempt to compete in the cloud market is impressive. Good luck to them.

ThePhysicist3• 6 years ago

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• 6 years ago

RAM maxing out at 32 GB

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

siscia2• 6 years ago

Honest question, Kubernets does not helps in closing the gap between AWS and Hetzner Cloud?

I would think that an honest setup supported by k8s would, at least alleviate the need of managed solution?

Are there AWS services without a competitive open source solution deployable in k8s?

service_bus• 6 years ago

Hetzner is great until you have some sort of issue.

They seem to either not have much in the way of internal procedures or just ignore them if they exist.

As long as you're prepared for all of your data and backups to just disappear, it's a great low-cost environment.

If you expect their operational team to not accidentally delete your environment, it just hasn't happened to you yet.

Hir0ki3• 6 years ago

They will probably build it on top of OpenStack or Kubernetes They are building it on top of OpenStack you can see it in there job offerings [1]

[1] https://stackit.de/de/karriere/

StreamBright5• 6 years ago

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

The prime factor driving negotiations is volume. It is going to be hard to beat AWS on this front.

> Beating AWS on EC2 pricing is easy. AWS EC2 pricing is insanely expensive.

This is simply not true. Taking into account everything you get with EC2 it is in par with other providers.

Factors:

- multiple (redundant) tier1 networking routes

- DDOS protection

- firewall

- redundant power (this almost never the case)

- access management that can easily be tuned to meet with corporate security standards

- network-attached storage that is very flexible with IOPS and size configurations

- multiple different hardware offerings that can match your workload

- elastic scalability (turn on when need more, turn off when no need)

- control over resource allocation down to AZ and shared/non-shared level

I am not saying that everybody needs these, but for those companies which do you won't be able to compete with a cheaper less powerful solution. These are the guys who can calculate what they are paying for and also know what they get, in detail.

There are so many moving parts in a datacenter that you can get wrong (and companies regularly do) that hiring the best dc engineers is going to be the first challenge when building an AWS competitor unless you have a James Hamilton clone stashed somewhere.

Neil44• 6 years ago

Almost all decent datacentres and compute providers have these features, and it's far from unusual to have downtime in an EC2 reigion to the point where the standard advice is to spread across multiple reigions to avoid being caught out. EC2 does not have DDOS protection as standard its an additional cost service (AWS Shield). They will just charge you an insane ammount for the DDOS bandwidth as standard.

Linode, DO etc all have these features at a fraction of the price.

carlmr• 6 years ago

Also, at least German companies really don't like uploading data to US servers.

brobdingnagians• 6 years ago

I'm American and at this point I don't really like uploading data to US servers. I can totally understand the sentiment.

ryan-allen• 6 years ago

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.

This has always been my problem with AWS. Cost savings might make sense for someone who actually needs 200 servers but if I just want one I'm paying 10 times as much for half as much in terms of performance.

It rubs me the wrong way when a $70/mo AWS instance is more than twice as slow than a $10/mo 'traditional' VPS instance.

dragonwriter3• 6 years ago

It rubs me the wrong way when a $70/mo AWS instance is more than twice as slow than a $10/mo 'traditional' VPS instance.

Elastic compute of the type provided by EC2 and similar services (Google Compute Engine, etc.) is a fundamentally different service than simple VPS. AWS has something that is, or is very close to, a simple VPS in LightSail, and the pricing is pretty competitive with other VPS providers.

LightSail doesn't have a $70/mo instance, the closest is $80/mo for a 16GB RAM, 4-core, 320GB SSD instance with 6TB of transfer quota. The least expensive is $3.50/mo, and $10/mo gets you 2GB RAM, 1 core, 60GB SSD, and 3TB transfer.

BiteCode_dev3• 6 years ago

Also, "my data is handled by a company under the EU law" is quite a good sale pitch these days.

loltyler1• 6 years ago

It is not.

dragonwriter3• 6 years ago

Also, "my data is handled by a company under the EU law" is quite a good sale pitch these days.

Everyone operating in the EU is under EU law, including Amazon, so it's certainly not a competitive pitch vs. Amazon, however much it might be on a checklist of things customers are looking for.

romanovcode• 6 years ago

What I really liked about Hetzner is that they provide VirtIO drivers so you can install Windows.

mongol3• 6 years ago

Also, for online retailers to put their eggs in Amazon's basket means they put their destiny in the hands of a competitor. Going for example with Azure is safer from this perspective. That said, Lidl is closer to Amazon than Microsoft, from that point of view.

radiator• 6 years ago

Hetzner Cloud exists and some efforts to automate Kubernetes deployments exist as well. It is of course not as polished as similar k8s AWS solutions, but as you said yourself it is much cheaper.

peterwwillis• 6 years ago

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.

Not really. AWS is largely independent service products with a few shared core services. K8s is just the core services.

Each AWS service is effectively its own product. Regardless of what tech you have in the background, you would have to make a complete product to compete with AWS's version. You would still have to build an entire customer interface and documentation and do product support.

Or you could build one giant monolith product that isn't decomposeable into services, and at that point you're no longer an AWS competitor, you're just another weird PaaS that enterprise won't touch. Enterprise is a whale, and you need whales.

Looking at k8s like it's a business solution is like looking at a wheel+tire and thinking it's a car.

KingOfCoders• 6 years ago

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.

icebraining2• 6 years ago

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.

tekkk• 6 years ago

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.

joyj2nd• 6 years ago

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...

isthisnametaken• 6 years ago

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

supermatt• 6 years ago

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.

Vosporos• 6 years ago

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

doener• 6 years ago

This is not was the original source says (in German and behind paywall: https://www.lebensmittelzeitung.net/tech-logistik/Lidl-und-K...).

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

fergie• 6 years ago

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.

sethx• 6 years ago

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.

agsilvio• 6 years ago

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

makkesk8• 6 years ago

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

Low prices? Seriously?

sidcool• 6 years ago

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.

lowercased• 6 years ago

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....

C1sc0cat3• 6 years ago

That's Lidl's MO they don't commit to having a consistent product line

asynch8• 6 years ago

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

slightwinder• 6 years ago

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.

pantulis• 6 years ago

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!

jillesvangurp• 6 years ago

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.

MaxBarraclough• 6 years ago

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

durnygbur• 6 years ago

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.

jonahbenton2• 6 years ago

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• 6 years ago

"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.

jonahbenton2• 6 years ago

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.

nprateem• 6 years ago

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

40four3• 6 years ago

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.

jpswade• 6 years ago

"The medium is the message" so they say. This is what the Internet has become.

The commentary is what makes this interesting, not the content of the article.

40four3• 6 years ago

Hey, I like comments and commentary as much as the next person. But when I waste 10 minutes of my morning perusing threads, I really hope they are about something real :)

To be fair, you're probably right. The commentary is the most interesting part, even if the content is just a rumor, or hypothetical or whatever. There is still some value to be had from the threads. I saw a lot of experiences or personal info shared here about Schwarz Group, so some of that was interesting.

SamuelAdams• 6 years ago

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

1MachineElf• 6 years ago

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.

bfieidhbrjr• 6 years ago

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?

Yes.

narrowtux• 6 years ago

No, this site is really fringe, I think nobody here was on this site before. I expect higher levels of quality from reputable news sources.

nojito• 6 years ago

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...).

it's not copy pasting. BI is also a publishing platform.

Same reason why you see Bloomberg articles in full being posting on Yahoo Finance.

dang• 6 years ago

You're probably right, but the thread turned out to be unexpectedly interesting.

40four3• 6 years ago

Fair point. I'll reconsider where I said 'stop talking about it'. Even bad stories can spawn good conversation! Some interesting inside experiences/ opinions about Schwarz Group were shared. Sometimes I need to keep my angry morning rant to myself! I'll try to keep this in mind in the future.

callamdelaney• 6 years ago

Perhaps they should think about an online store first?

Hir0ki3• 6 years ago

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...

atlgator• 6 years ago

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

daralthus• 6 years ago

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

zeruch• 6 years ago

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

tewwi• 6 years ago

Too Lidl too late? (sorry)

Bayart3• 6 years ago

Headlines you never expected to read.

ThinkBeat• 6 years ago

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.

cocoland• 6 years ago

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 :)

Lidl to Launch Rival to AWS

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