Lastminute.com: Forget Google - we're the innovators

Chip Steinmetz, Part II: In the second part of an exclusive interview, Lastminute.com's CTO explains why the UK travel site is at the cutting edge of computer science
Written by Andrew Donoghue, Contributor

Chip Steinmetz is on a mission. While US dot-coms such as Google, Amazon and eBay have been praised for their technical innovation, UK Web survivor Lastminute.com has shuffled around in the shadows -- seen as functional but not exactly cutting-edge.

But since his appointment as Lastminute's CTO almost a year ago, the ex-head of Walt Disney Internet Group, has trying to redress the balance. He's been slowly re-architecting the site and bulking out his tech-team with computer science PhDs -- made financially possibly in part by the decision to outsource core database administration to Argentina.

Steinmetz, whose CV includes developing real-time trading systems for the likes of Credit Suisse First Boston, claims the search technology required to collate fluctuating and temporary flight times and prices with hotel reservation systems is much harder than anything that Amazon has to cope with. Book prices don't tend change from one hour to the next, he says. 

ZDNet UK spoke to Steinmetz about the Argentine connection, location-based services and the computer-science challenges of travel.

Google has done a lot to foster its reputation as a technical innovator. Do you think Lastminute would benefit from following suit?
I think Google is a good example. I know a lot about search -- I ran the Infoseek search engine at Disney. Let's say you do a Google search, what have they got? They have got a bunch of spiders that go out there and bring everything back. They have got a great big bank of 20,000 PCs all chained together that do searches in parallel, bring your index back in the right order and you pick one.

Now consider us doing a hotel search. The first thing that comes up is that you might do a geo-spatial search; you might want to stay 30km from the Eiffel Tower. So we actually have a map that comes up. It has coordinates with little pictures of the hotel on it, you can click on it. That goes to a latitude/longitude database, which gives a correlation to a city and a country. Then you find your hotel; there are around 50,000 properties that explode out in 60GB of data. That hotel chain then explodes out into all sorts of room types. Then the search degenerates into a temporal search through time because that room price is only available for a certain period. It's almost like a tick-by-tick database almost like they have in stock and bond trading applications. Now we are doing that in real-time and we are giving you instantaneous results.

Now technologically, I think that is ten times more difficult than search - not one of scale but pure computer science. On our search team we have three guys who have PhD's in neural nets who are really attracted here because of the computer-science problems.

Have you hired a lot of new staff since you arrived?
Yep. Most of the recruiting has been permanent staff out of the UK [and] a few guys from the US that maybe had special skills. But I would say you could find everything you need in the UK pretty much. We are also going to do some university recruiting this year out of Imperial and the five or six best schools.

Would you consider doing something like Google does in the US with its Code-Jam programming contest?
Yeah, I look at that, it's pretty neat. They use a company called TopCoder -- who I worked with at Disney -- which is really neat.

There were some recent reports in the press about you outsourcing some of your tech operation to Argentina. What was the thinking behind that?
It's probably best to talk about what we aren't outsourcing to begin with. We are really the only big development shop in Europe at the moment. Consequently what we are not outsourcing is our crown jewels or high-tech things that are really giving us a high-tech advantage. In fact we will invest more in that and that's why we will do some serious University recruiting this year. That is why we have hired lots of people from the top schools this year and they are working on things like our search engines, our shopping basket, the JBoss infrastructure. There is like 130 guys there permanently and we will increase that staff of guys by 15 percent.

But we also want to be as competitive as we can when it come to investing in those key areas. So what we did was look at our technical operations function -- that includes Unix administration, database administration, things like that. And I think accidentally there were some teams of people that built very large open-source ecommerce projects for the Argentinean government. The economy there has changed tremendously and interestingly there are a large number of Argentine people with dual passports. That is a tremendous advantage as you don't have to go through all the problems you have in India.

We brought 20 guys here and they worked here side-by-side and then we took those functions and now we have those running in Argentina. I don't know anyone else who is a big e-commerce site who has off-shored their core infrastructure. I don't know that Amazon or Google has done it and I think they would be scared to death. So it was very high-risk. What is especially cool is that because there is a time-zone change we will have much better 24X7 support of the site as they start three-hours later. Without having to abuse people, we have improved our service -- do you want [to] go hire guys in the UK and tell them to work through the night?

This is different to outsourcing the way other people have done it, which is 'I have got a bunch of shitty processes I don't care about so I'll just dump those and try and do it for half the price'. We took a high-tech approach and changed the processes and outsourced an area that most probably don't do yet but it will be a trend, though.

So is Buenos Aires going to be the next Bangalore?
I think there is some opportunity. I have heard good reports from our vendors like IBM and Sun who have expanded their operations there. So I think there will be others to follow but we are leading the edge for sure. I am pretty proud it works.

Has the rise in broadband use had much impact on the amount of multimedia you can integrate into the site?
I would say we don't have to worry about more advanced multimedia technologies for a while. That really isn't on the horizon. I am really focused on this year and next year -- how do we make a really great Web site for that period of time? If we could make the site twice as fast and twice as reliable, that alone would be such a great experience that we wouldn't need to anything else for a while. It doesn't mean that we're not making investment on advanced technologies in other areas: we're doing work with making hotel reservations using voice recognition.

How about 3G? T-Mobile and Vodafone launched their services recently with Orange in beta and due to follow suit in the next few months. Are you going to expand your deal with 3 to include other networks?
Yes, absolutely. It would be things like not just the Web site on phones but imagine things like maps. It would be cool to have a good map to know how to get to places. Location-based services would be very interesting. Being able to tie where you are with where you want to go automatically would be great. We are going to be in a position to do that in the next month or so.

So location-based services in the next month?
Well, we're going to be in development in the next month but we should be in a position to launch something in the spring maybe.

Would that be with 3 as the service provider?
Well, I'm not sure what I can say but I don't think that it necessarily means using 3G technologies.

Would you be interested in going down the same road as Amazon and eBay in offering various components of the site as separate Web services that affiliates can incorporate into their sites?
Yeah. It's pretty interesting and I think it would be pretty easy for us to do the same thing and offer things like searches for travel. I could imagine doing that.

You installed a wireless LAN internally recently. Do you have any plans around hot spots in the same vein as the kiosks you have in airports?
I think it could be very appealing and a great customer experience. I would use it when I travelled; I think a lot of people would.

Any timeframe on that or is it just a good thing for the future?
I think it's something good for the future...

Click here for Part 1 of this interview.

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