Wal-Mart Orders Tech Partners to Get Off Amazon Cloud (MSFT, WMT)

Walmart is notifying tech companies that they aren't allowed to run apps on Amazon's platform if they want to do business, according to a Wall Street Journal report published Wednesday.

Apparently feeling threatened by that deal, the retail giant has reportedly told its developer partners not to use Amazon Web Services Inc.to host their cloud applications.

Wal-Mart, of course, aims to clarify: spokesperson Dan Toporek explained, in an email to the Wall Street Journal, "Our vendors have the choice of using any cloud provider that meets their needs and their customers needs".

For its part, Amazon said its rival was attempting to "bully" developers, adding that such tactics are "bad for business and customers". However, AWS is completely separate to Amazon.

Wal-Mart, loath to give any business to Amazon, said it keeps most of its data on its own servers and uses services from emerging AWS competitors, such as Microsoft Corp.'s MSFT, -0.01% Azure.

"They influence their vendors, which has influence on us", CEO Bob Muglia told the paper, speaking of Wal-Mart. This was nearly $1 billion more than the company's North American retail sales, according to Amazon's fourth quarter results for the period ended December 31, 2016.

While Walmart's efforts may not stunt the growth of AWS, they are certainly helping their competitors. "That should absolutely accelerate the competition from Azure".

The retailer has been trying to boost its e-commerce presence as it competes with Amazon.

Also well documented is Wal-Mart's close and growing ties to Azure cloud. However, since it's a market corporation its often mistaken to be a direct competitor to Wal-Mart.

Alphabet Inc. declined to say whether Google Cloud, the No. 3 cloud-infrastructure provider, has benefited from the spat between Wal-Mart and Amazon.

But while that might seem a bit harsh, it appears that Wal-Mart may not be the only company to feel this way. To win the business, Lofty Labs had to develop the application for Azure. The service is the only one Lofty Labs ever developed to work on Azure. AWS is a pretty secure service and their terms pretty much show how well the data of anyone who uses it is protected.

  • Joanne Flowers