Amazon Steals Big Microsoft Customer With Whole Foods Purchase

Microsoft bragged about having Whole Foods as an Azure, Active Directory and Office 365 customer. Are those bragging rights going to Amazon now?

Mitch Wagner, Executive Editor, Light Reading

June 18, 2017

3 Min Read
Amazon Steals Big Microsoft Customer With Whole Foods Purchase

Amazon is picking up one of competitor Microsoft's marquee customers with its $13.7 billion bid to buy retailer Whole Foods.

Whole Foods is looking to software-as-a-service (SaaS) from Microsoft on its path to growing from 462 stores to 1,200 in the near future, according to a November write-up on Microsoft's website (still available as of late Friday morning).

Whole Foods previously used Microsoft Active Directory in the Windows Server operating system to provide single sign-on identity credentials for the store's 20,000 information workers. As it transitioned to SaaS and wanted to bring on 71,000 store workers, Whole Foods switched to the cloud, to Microsoft Azure Active Directory Premium to manage employee identities.

Figure 1: Photo by ChadPerez49 (Own work) [CC BY-SA 4.0], via Wikimedia Commons Photo by ChadPerez49 (Own work) [CC BY-SA 4.0], via Wikimedia Commons

Whole Foods is also using Microsoft Office 365, and considering other cloud security offerings, Microsoft said in November.

Under new ownership, Whole Foods could move to Amazon Web Services Inc. (AWS) while still keeping Active Directory; AWS provides Active Directory support. Indeed, if the transition is fast and easy, Amazon would be able to brag about it in its marketing.

As for Office 365, AWS doesn't have a competitive offering -- at least not yet. It recently launched AWS Chime to compete with Skype for Business, and AWS WorkMail launched in 2015, competing with Office 365's email. However, AWS's office offerings lack the breadth of Office 365. (See Amazon Chime Targets Skype, WebEx and Lawyers Ring Amazon's Chimes – Lawsuit Charges Trademark Ripoff.)

That could change as Amazon is reportedly working on its own productivity suite.

Amazon announced Friday it plans to acquire the supermarket chain, giving the e-tailer a big footprint in brick-and-mortar retail.

Ironically, Amazon won a patent just two weeks ago on technology to block "showrooming" -- which is when you go into a store, see a product on the shelves you like, whip out your smartphone, and do a search to see if you can get a better deal elsewhere. Amazon's getting the patent then might have been a purely defensive move -- since people often showroom themselves right into an Amazon purchase. But the patent also covers technology that would redirect the consumer to the brick-and-mortar store's own website, or allow the brick-and-mortar retailer to make a better offer, so the technology could be useful in Amazon's new Whole Foods subsidiary (assuming the deal goes through).

Also, this tweet. (Warning: Mild adult language.)

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About the Author(s)

Mitch Wagner

Executive Editor, Light Reading

San Diego-based Mitch Wagner is many things. As well as being "our guy" on the West Coast (of the US, not Scotland, or anywhere else with indifferent meteorological conditions), he's a husband (to his wife), dissatisfied Democrat, American (so he could be President some day), nonobservant Jew, and science fiction fan. Not necessarily in that order.

He's also one half of a special duo, along with Minnie, who is the co-habitor of the West Coast Bureau and Light Reading's primary chewer of sticks, though she is not the only one on the team who regularly munches on bark.

Wagner, whose previous positions include Editor-in-Chief at Internet Evolution and Executive Editor at InformationWeek, will be responsible for tracking and reporting on developments in Silicon Valley and other US West Coast hotspots of communications technology innovation.

Beats: Software-defined networking (SDN), network functions virtualization (NFV), IP networking, and colored foods (such as 'green rice').

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