Amazon.com has fleshed out how it is using Web services to drive sales and increase profits, impressing experts familiar with this new model of computing.
Web services describes a way of using internet-based standards such as XML, SOAP, UDDI and WSDL to connect software and data sources, both within and across companies, to enable various end user offerings.
Amazon Web Services was announced last July and is aimed at benefiting Amazon.com by bringing it closer to developers, website owners and merchants with whom it has relationships.
For example, a site that advertises books which can then be bought via a link to Amazon.com -- usually in exchange for a percentage of any sale -- no longer has to manually update product information on a page. Web services, by using a series of XML tags, allows a page to dynamically update as Amazon.com changes pricing, product description, availability and other details. A page can even be re-sized to fit the space on another website using Web services.
Colin Bryar, Amazon.com Web services director, told silicon.com: "Consumers will benefit because they see features they'd normally only see on the Amazon.com website across the Web."
However, the real story, beyond consumers, involves developers being able to innovate more easily and merchants and third-party websites being able to make more money -- so making Amazon.com more money -- by being able to manage inventory better or being able to display in-depth, up-to-date information.
For example website simplest-shop.com shows a range of product information all seamlessly linked to Amazon.com's back end systems.
Such operations -- and there are hundreds of thousands now -- are important to Amazon.com because it makes a "significant percentage" of its sales through other sites. "It's less than 50 percent, but significant," Bryar said.
Amazon.com's advances with Web services, developed by an in-house team of fewer than 50 under Bryar's leadership, place the company at the vanguard of the trend, according to experts.
Mike Thompson, Butler Group principal research analyst, said: "What they are using is just a SOAP API [application programming interface] but it's impressive they've actually gone out there and done something. They're showing partners don't have to do lots of hard-coded connections -- and that's what Web services are all about."
At the end of last year Butler Group identified companies in the travel sector as leading the uptake of Web services. For example, car rental and hotel booking information across various companies is being linked to back-end transactional capabilities.
Thompson said this is more complicated than what Amazon is doing but that the e-tailer is still "right at the forefront."
Amazon.com also claims not to fall into either of the two major Web services camps -- one revolving around .Net and Microsoft and the other around J2EE and vendors such as IBM, Oracle and Sun.
"We offer services to developers who use whatever tools," Amazon.com's Bryar said. "We're not religious about the technology but if the market goes one way, we will follow."
In line with research from other analysts, Butler Group is staying optimistic about the future of Web services. "All information resides somewhere and Web services provide the interface to access it, wherever it may be," Butler's Thompson added.
"This is really the start of the 'information age'. People have been talking about the 'information age' for the last 30 years but now we can see it was simply the 'data age'."
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