Online blip – money better spent at the pub?

Published on 8th April 2013 by Penny Jones

I have just given up trying to access a web page to make a purchase. And it is not – I am sure like many of you – the first time. Covering this industry, I realize this could be down to a number of things, but at the end of the day I don’t feel like trying again and to be honest I have lost a slither of trust in the service altogether.

The incident made me think about an interview I conducted late last year, after Cyber Monday, with Equinix. For those not aware of the term, you may be more aware of Black Friday – both are used for Friday that follows Thanksgiving in the US, when happy shopper flock to online sites to make purchases – they spent US$1.028bn on Cyber Monday in 2010 alone.

I was speaking with Equinix’s global general manager of cloud and content Chris Sharp about the demands of Black Friday, which offer insight into the overall demands of the online retail space on cloud provision, the content delivery network, online advertising, data analysis and space, power and contingency plans in the data center.

He reported statistics gathered by Amazon which found that for every 100ms of latency cost them 1% in sales. Another report, this time by Google, said that it lost 20% of traffic every time it took an extra .5 seconds in search page generation.

We are a demanding lot us end users (or buyers in the case of those filling the coffers of retailers on Black Friday). And few of us give ever pay homage to the challenges that go behind the online efforts that make us spend.

Sharp has worked with numerous retailers targeting this market. He knows how much work goes into getting this right, not just by Equinix but by its customers who really have to understand how they can use the Cloud in an ever-evolving space.

Many of these customers are global, so content distribution goes beyond the local approach. But servicing a customer on their local backbone can provide content 30% faster. “How you achieve the highest level of latency or the highest end-user experience is a huge factor in the success of online retail,” Sharp says. “But one limitation out there is the connectivity between the private cloud and public cloud. You have to know when to utilize cloud infrastructure, as that is where the best economics are out there, and it has to be a hybrid model for the elasticity and cost savings.”

Equinix worked with Amazon on its Direct Connect offering, which helps establish a dedicated network connection from on premise into the Amazon cloud or from the cloud to your colocation premise. The aim here was a consistent internet-based network connection.

“The aim was to get a truly single pane of glass to allow customers to move workloads between public and private, inside Equinix. This allows that elasticity and highly redundant throughput activity – this is the optimal model for these ecommerce guys. You get a price break on the cloud services because you are not using transit, and private cross connect or access to the Cloud.”

The other benefit is having your data delivered form the right region. But not all retailers have been that savvy. Past Amazon outages have proved that many cloud users only set up one availability zone, or fail to put in measures to spin up new ones when things go amiss.

Then there is the issue of data analytics. Retailers must understand their own traditional user statistics, and how much their own private cloud can handle, and if they are using third-party services, how much demand could exist on any of these at any one time.

“Amazon cloud has thousands of customers and many of these are e-commerce, so they will all want to access the same resources for their elastic model,” Sharp says. These guys are only now starting to understand there can be huge bottlenecks that exist out there.”

Events like Cyber Monday lead to new revenue generators, from targeting marketing to new sales techniques, and increasingly data analysers are being called in to help in this area. Advertising exchanges have also been formed – technology platforms that facilitate the buying and selling of online media advertising inventory.

It’s all quite complex, despite the websites - often to the end user - seeming quite simple.

For the likes of Equinix, this complexity is feeding demand. Its own internal marketplace can be called up when Equinix offers consultancy services that can cover the breadth of what a retailer needs to deliver. I dare say this market also opens up avenues for cloud brokers, and anyone else edging in to the industry. And it is all feeding off my purchasing decision, or indecision.

In the meantime, I still haven’t managed to make my purchase, and my day is close to ending here in London – it is nearly time for the pub, so before I log on again my money will have most likely been spent elsewhere.


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Penny Jones is the Global Editor for FOCUS online and FOCUS magazine

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