eBay buy signals retail-as-a-service cloud
X.Commerce marks the spot
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eBay has bought a tiny PHP specialist as a precursor to rolling out a massive cloud commerce platform-as-a-service for retailers, complete with an app-store fed by web developers.
On Monday, the web giant said it had snapped up shopping engine specialist Magento, which will be merged with X.Commerce, an open-source platform group it announced at the same time. eBay had already owned 49 per cent of Magento, after it invested $22.5m in March 2010.
The new X.Commerce group will work on delivering and then extending a hosted, customizable and modular e-commerce platform for use by eBay's army of retailers.
X.Commerce consists of 500 employees from Magento, eBay, and PayPal, and it's run by 10-and-a-half year eBay veteran and former head of PayPal engineering Matthew Mengerink.
Mengerink tells The Reg that his group is creating an app store that will be populated by PHP, Javascript and AJAX e-commerce apps from developers. These apps will be intended for merchants. Apps will be integrated and will work together via a planned software layer called X.Fabric. Magento will provide the storefront via Go, a software-as-a-service it built with eBay that gives merchants a system for marketing, promotions, payment, checkout, and shipping.
The whole lot is due to be delivered in time for eBay's X.Commerce Innovate conference, between October 12 and 13, in San Francisco, California, Mengerink said.
Joining the X.Commerce group as chief technology officer is Yahoo!'s former vice president for social platforms Neil Sample. He joined eBay from Yahoo! last summer, as eBay architecture chief. Sample is reporting to Mengerink and an PayPal spokesperson told The Reg that Sample had joined up "because of the opportunity that X.Commerce offers."
Mengerink describes what eBay is building as "a commerce operating system" that will give developers one place where they sell their commerce apps and where retailers can built exciting web stores without needing to search for e-commerce modules from across the web that they must then stitch together.
"There isn't one place, one stop solution that has one integration," Mengerink said. "We are going to fill out the operating system so every aspect of commerce is available from the store front or the API suite in a consistent fashion that makes it easier for the developers to extend."
But what Mengerink is calling an operating system could also qualify as a "cloud". It sounds like what eBay has planned is a platform-as-a-service for businesses just like the Salesforce cloud. Salesforce customers install apps to their account from a central app store that they can use to customize the basic Salesforce platform, a platform that holds all their transaction and customer data, provides security, compute elasticity, and that provides a transaction layer that allows all the applications to talk to each other and work.
For this to become reality, eBay would need a cloud-computing and storage layer that the existing eBay service currently lacks. Last year, eBay was one of four companies who'd agree to test and develop Microsoft's cloud, Azure, in a metal box called an appliance. Dell, Hewlett-Packard, and Fujitsu were the other three. But the Azure appliance has missed all deadlines known to man since being announced last summer.
eBay could go with Amazon, but the company is too much like a competitor. The answer might be OpenStack, the open-source cloud compute and storage project co-founded last year by NASA and web host Rackspace.
While eBay is not an OpenStack member, Sample attended the OpenStack Design Summit in April, where he spoke about eBay and OpenStack. Sample called the open-cloud increasingly viable, saying it has progressed a lot in the nearly 12 months since it was announced by Rackspace and NASA from a point where eBay would not have considered running it.
Based on Sample's comments at that architecture event here, it looks like eBay is edging towards OpenStack because the code is open "versus a black-box and a vendor, who will someday get back to us and say 'yeah, yeah, we'll get you that feature in six months."
"There's been a ton of progress and we are very optimistic," he said of OpenStack.
PayPal would not comment on whether it is going to pick OpenStack for X.Commerce.
eBay's decision to pick PHP, Javascript, and AJAX and to move away from its Java and C++ roots is both interesting and timely. Mengerink said he is not religious about languages, but he noted that PHP has a "great resonance with the broader developer community, more than Java". eBay is keeping a Java interface to the new system for enterprise customers. Java is also used on other areas of eBay.com. It had evaluated PHP on the main site but decided to stick with Java. ®
COMMENTS
Paypal is more dead than you think..
.. as there is a new service negotiating capital investment that effectively nukes all online card fraud (no, it's not yet-another-mobile-phone gadget). Let's hope they get funds soon - I'm sick & tired checking my statements every month for fraudulent entries.
Here we go again: privacy risks galore
It's all jolly well doing cloud-thingies, but the problem remains the same: as a customer, I don't know where my information is held, under which jurisdiction. We've already seen what can happen: you use a service in the UK and your data is extracted in a jurisdiction that doesn't worry too much about protection of private information (Twitter, anyone?) - that's going to be fun when credit card data is involved..
Clouds have very fluffy edges - beware.
eBay, Magento, AliExpress, Skype, PayPal, Google, Schmoogle, whatever
eBay, Magento, AliExpress, Skype, PayPal, Google, Schmoogle, whatever
The rusting old hulk eBay is presently being kept afloat by PreyPal so it’s good to see these boys recently squabbling and threats to the clunky PreyPal now coming thick and fast. It’s interesting times for all we eBay “haters” (oops, I mean “watchers”). I just hope that someone has remembered to bring the popcorn.
PayPal is mostly registered in various places not as a “bank” but only as a “money transmitter” (like Western Union), and PayPal actually claims that they are not a “payment processor”, and there is a minute degree of truth in that claim because it could, nonsensically, be claimed that they do no more than facilitate the transmission of money by riding on the back of the banks’ existing payments processing systems.
In fact, the only thing creative about PayPal has been their use of users’ email addresses as an identifier for online transactions. PayPal is otherwise no more than a blood-sucking parasite on, and in the main cannot function except via, the banks’ existing payments system (via their banker, GE Money Bank—Ugh!).
PayPal, outside of whatever will ultimately be left of the Donahoe-devastated eBay Marketplace, will undoubtedly eventually be consigned to the history books by all the retail banks/Visa/Mastercard once those players get their “online” act together.
Some people may not like “the banks” but all those participating retail banks at least supply a professionally run payments processing system—unlike PayPal’s—and even PayPal concurs with that assessment: except for intra PayPal “account” transactions, they use the banks’ payments processing system all the time and simply could not exist without it.
Regardless, all the above comments apply equally to all of the other third-party “payments processors” that are emerging out of the woodwork and wanting to have access to your banking account. Unless they a formal arrangement with all the participating retail banks, as do the likes of Visa/MasterCard, then the result is invariably going to be as potentially problematic as presently is PayPal’s clunky operation for its merchants, and many of them can tell you a sorry tale or two.
All anyone needs to know about the clunky PayPal can be found at:
http://forums.auctionbytes.com/vbulletin/showthread.php?p=165263
Is that PayPal’s blood in the water, and are those “sharks” (oops, “banks”) I can see circling?
Enron / eBay / PayPal / Donahoe: Dead Men Walking.
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