E-Commerce Moves To The Cloud
This week much of the tech world has been a buzz about news coming out of AWS re:Invent 2017. I start with this because when talking about e-commerce moving to the cloud it is hard not to talk about AWS’s impact on that space. When I speak of e-commerce I include retailers as well as payment related companies. This is a big business and the other hyperscalers ( Microsoft, Google, Oracle and IBM) certainly are fighting to grow their share in the market.
Open API’s Create Interdependence in E-Commerce
Retailers, payment gateways, and mobile point of sale systems use Open API’s to create a digital supply chain that looks seamless to the end user. Open API’s have unbundled the payments stack so that now during a transaction the six or seven companies may be involved in what was once all done by a single payment processor. Transaction approval still happen relatively quickly to the end user, but as the interdependence of companies involved increase the possibilities for timeouts for approval can occur.
Internet Creates Unpredictable Routing and Varying Latency
Cloud providers have multiple availability zones dispersed geographically so that companies can decide where they would like to deploy applications. E-commerce sites will try to optimize which availability zones they use to lower latency to the end users, but that same availability zone may not be optimal for the payment processor they use. If a retailer is completely deployed in the cloud, but its payment gateway is operating out of its own data center that traffic will route over the Internet using unpredictable paths and varying latency. When processing timeouts occur it not only is difficult to troubleshoot what caused the delay, but it is equally or even more difficult to correct it under those conditions.
Improving Payment Processing To/From The Cloud with Hybrid Cloud Architecture
A better option for e-commerce companies, both retailers and payment related companies, is to deploy a hybrid cloud architecture, leveraging meet-me locations such as Equinix where in the prior example the retailer can get a private connection from its cloud provider to the retailers network point of presence. The retailer then has a couple of options to improve it’s connectivity to the payment provider. In addition to the diverse choices of private connectivity to 1000’s of cloud providers, Equinix has a robust ecosystem of payment companies inside of their data centers. A low cost cross-connect between the retailer’s cabinet and the payment service provider’s cabinet will provide a ultra-low latency connection with essentially no variation in latency. If the payment service provider is not present in the same market, the retailer can either accept a router into is cabinet with a private MPLS circuit from a traditional carrier. If cross-connects or MPLS are not options that the payment service provider supports then the retailer can get an IX port at Equinix to exchange network routes with with Internet Service Providers or other IX participants (creating a somewhat private Internet between them.)