Amazon Web Services' Australian chief has dismissed suggestions local retailers will pull out of the company\u2019s cloud services following the arrival of Amazon.com.au in the country.\nPaul Migliorini, managing director of AWS in A\/NZ, told CIO Australia that major retailers want access to the best cloud technology and leaving the platform to avoid helping their biggest competitor "doesn\u2019t make rational sense".\n \nAmazon Australia went live this morning, ending almost a year of hype and speculation about the timing of the launch.\n \nIts arrival has already had a damaging effect on Australia\u2019s biggest retailers. Shares in Myer are down 30 per cent since Amazon confirmed its Australia plans in April. Shares in electronics retailer Harvey Norman have fallen 7 per cent since the announcement and JB Hi-Fi shares are down by 6 per cent.\n \nIn the US, the likes of Walmart, the country\u2019s biggest retail chain, and Target, the second largest, are reportedly shunning Amazon\u2019s cloud computing arm in an effort to avoid indirectly financing a rival.\n \nWalmart \u2013 although predominantly a customer of Microsoft Azure \u2013 has, according to a Wall Street Journal report, been telling its technology partners to take their apps off of AWS. \n"Our vendors have the choice of using any cloud provider that meets their needs and their customers' needs," a spokesperson for Walmart later clarified.\n \n"It shouldn't be a big surprise that there are cases in which we'd prefer our most sensitive data isn't sitting on a competitor's platform."\n \nAmazon responded by calling out Walmart as a \u201cbully\u201d.\n \nTarget meanwhile is scaling back its use of AWS, according to a CNBC report, with a source saying the retailer was planning to aggressively move e-commerce activities, mobile development and operations away from AWS through the end of the year and into 2018.\nAlthough Target has made no statement on the reports, in a late 2016 blog post on its adoption of open source platform Spinnaker it noted the \u201cold system wasn\u2019t cloud-agnostic, meaning it only allowed us to make updates, or \u2018deploy,\u2019 to a single cloud provider\u201d.\n \nAussie backlash?\nMigliorini said AWS was not expecting a similar reaction locally, although customers had been asking about the connection between Amazon\u2019s e-commerce and cloud arms.\n \n\u201cWe don't see the two as related. Obviously AWS and Amazon.com run separately and many of Amazon.com\u2019s competitors are great customers of ours, so we run very, very separatelyhellip; But I have heard that and customers do rightly ask us questions, you know, \u2018what's the linkage?\u2019\u201d Migliorini told CIO Australia on the sidelines of AWS\u2019 Re:Invent conference in Las Vegas last week.\nAWS operates as a subsidiary of Amazon.com with an US$18 billion revenue run rate and a 42 per cent annual growth rate. It is far and away the public cloud market leader with a 44 per cent share of the market, according to Gartner.\n \nIn recent quarters AWS\u2019s operating profits have covered the operating losses suffered by Amazon\u2019s e-commerce business, giving Amazon the ability to aggressively expand and run on razor thin margins.\n \nMigliorini said many direct competitors of Amazon in Australia were using AWS platform to huge benefit.\n \n\u201cWhat we find is we've got a lot of great retailers doing really well on our platform, people like Kogan and The Iconic who are actually out and out competitors of Amazon.com and what they tell us is, what they care about is that we continue to iterate at the right rate to enable them to focus on their differentiating capabilities while we do the undifferentiated work,\u201d Migliorini added.\n\u201cAnd as long as we continue to do that they\u2019ll continue to work with us.\u201d\n \nUnderstandable thought\nWhen asked whether the arrival of Amazon.com would prompt a move from AWS, online fashion storeThe Iconic confirmed to CIO Australia that \u201cyes we are currently on AWS, but we wish to make no further comment at this stage\u201d.\n \nKogan.com \u2013 which last year acquired Dick Smith\u2019s online business \u2013 did not respond to a request for comment by the time of publication.\n \nAustralian retailer Harvey Norman \u2013 whose chairman Gerry Harvey has been a vocal opponent of Amazon \u2013 was named as a customer of AWS when the company launched two availability zones in Sydney in 2012.\n \nA spokesperson confirmed Harvey Norman utilised AWS predominantly for its overseas operations, with Microsoft Azure used in the main in Australia.\n \n\u201cWe\u2019ve got no changes planned for the current moment but like all third party services we look at those on a regular basis,\u201d the spokesperson told CIO Australia.\n \nAsked about the moves made by US retailers, they added: \u201cIt\u2019s a very understandable thought. Why would you want to prop up a competitor?\u201d\n \nAWS\u2019 Migliorini said local retailers were sophisticated enough to see the advantages of sticking with the cloud company.\n \n\u201cWhat we see is Australian retailers are really sophisticated users of technology so they can go deeper than that thin veneer and understand what the best technology choice is. They can move beyond those irrational emotional decisions,\u201d he said.\n \nIn any case, if any were seeking to depart AWS as some in the US had, it would have little impact on the business, Migliorini said.\n\u201cJust look at the numbers. Amazon.com is an over $150 billion global corporation. Is it really going to make any material difference whether a retailer in Australia uses AWS in terms of helping or not helping Amazon.com? It just doesn\u2019t make rational sense,\u201d he added.\n\nThe author travelled to AWS Re:Invent 2017 in Las Vegas as a guest of Amazon Web Services.