By Md. Taraq Junaid
In a bid to enhance the online shopping experience for millions of its users, Flipkart has adopted Microsoft Azure as its exclusive public cloud platform. The association came through following the visit of Mr Satya Nadella, CEO of Microsoft, who was in Bangalore for a tech event. On 20th February, Microsoft released a statement announcing the strategic partnership with the domestic e-commerce giant.
“We are launching our strategic partnership together. I have always been an admirer of what Flipkart has done, in not only starting e-commerce but now in payments and logistics. It is really getting India on the map. I’m pleased to announce that Flipkart has chosen Microsoft Azure as its exclusive public cloud platform” said Nadella.
Flipkart selects Microsoft Azure as its exclusive public cloud platform | Picture Courtesy – Street ResearchThe past, present and future of Flipkart
Flipkart was launched in the year 2007. Currently, it is one of the biggest e-commerce players in the country with an estimated of 100 million users.
“This partnership allows us to leverage our combined strength and knowledge of technology, e-commerce and markets to make online shopping more relevant and enriching for customers,” said Binny Bansal, co-founder of Flipkart.
Machine learning and artificial intelligence (AI) are changing the way markets work. With this, Flipkart also plans to utilise the technological resources available at Microsoft. “Flipkart plans to leverage artificial intelligence, machine learning and analytics capabilities in Azure, such as Cortana Intelligence Suite and Power BI, to optimise its data for innovative merchandising, advertising, marketing and customer service” Microsoft said in a statement.
Amazon – the nemesis
[su_pullquote]Currently, Microsoft Azure is the second largest cloud service provider in the world. However, Amazon Web Services (AWS) hosted by the e-tailer leads the pack.[/su_pullquote]
The collaboration will be game-changing for both Microsoft and Flipkart. Currently, Microsoft Azure is the second largest cloud service provider in the world. However, Amazon Web Services (AWS) hosted by the e-tailer leads the pack. According to a Synergy Research Group (SRG) study on cloud market share, AWS has a market share of 31% compared to 12% of Microsoft Azure. Microsoft, which has several holdings in India, can also expect considerable improvement in its local brand image.
On the other hand, Flipkart faces fierce competition from Amazon. A new round of investment was announced by Amazon in India in June 2016. Amazon and Flipkart are famous for their festive day battles. They have been trying to tear each other apart right from the beginning. In 2016, the face-off during Flipkarts Big Billion Day and Amazons Great Indian Festival saw both the sides taking digs at each other on various online/media platforms. Flipkart won the sale but Amazon was quick to bounce back with aggressive pricing strategies. It managed to register huge growth in the same month.
The partnership between Flipkart and Microsoft will intensify the competition between the e-commerce giants | Picture Courtesy – The Indian ExpressThe alliance to outplay the rival
The high-profile partnership between Flipkart and Microsoft will surely intensify the competition between the e-commerce giants.
Flipkart’s huge user base in India still leaves it under-equipped compared to Amazon. The primary source of revenue for Flipkart is its e-commerce website. At the same time, Amazon has a plethora of revenue generation sources. This gives Amazon a huge advantage.
However, Amazon could employ cost-cutting strategies simply to kill the competition. On the other hand, Flipkart cannot do the same. This is because of the fact that it would not want to add to its already massive pile of debt. Also, the recent markdown of Flipkarts stock, by Morgan Stanley, has made it tougher for the e-tailer to raise funds. Moreover, it cannot even eye a higher valuation. It is evident that Flipkart cannot take down Amazon on its own. But, for the moment, it has the support of Microsoft to fight their common nemesis.