Amazon strikes bodily retail tech groups into cloud division, seeking to speed up third-party adoption

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Dilip Kumar, Amazon’s vice president of physical retail and technology, discusses the Amazon One palm recognition and payment system at the company’s re:MARS conference in Las Vegas in June. Kumar and Amazon’s physical retail tech teams are shifting to Amazon Web Services. (GeekWire Photo / Todd Bishop)

Amazon is shifting tech teams for its physical stores from its consumer division to its Amazon Web Services cloud division, aiming to further expand the use of the company’s in-store technologies by other retailers.

Dilip Kumar, Amazon’s vice president of physical retail and technology, will move to AWS along with executives and teams responsible for the Just Walk Out cashier-less checkout technology, the Amazon Dash Cart, and the Amazon One palm-recognition and payment service, among other technologies, according to an internal email.

News site Insider first reported the changes earlier today, and GeekWire confirmed them independently.

Amazon has increasingly been looking to license these retail technologies to others after they debuted in the company’s own stores, including Amazon Go convenience and grocery stores.

AWS, under divisional CEO Adam Selipsky, is the tech giant’s main pathway for offering technology to other companies. The goal is to “position our suite of checkout technology, products, and services for growth beyond our stores,” wrote Tony Hoggett, Amazon’s senior vice president of physical stores, in the email.

Its best known in-store technology, Just Walk Out, logs shoppers in when they enter a store, using cameras and sensors to detect when they pick items up, allowing the system to charge them after they leave the store, without going through a checkout, using payment information stored in advance.

Earlier this month, in a post on the AWS for Industries blog, Amazon said Just Walk Out is available at more than a dozen third-party stores in addition to more than 50 Amazon stores.

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“These technologies have helped differentiate our physical store offerings, and the success of these products and services are generating increased interest from [third-party] customers,” Hoggett wrote. “Our teams will continue to work closely together given this is a continued priority in our first-party stores.”

It’s part of a broader set of changes in Amazon’s physical stores division following Hoggett’s arrival at the Seattle company last year from Tesco, the British supermarket chain.

Earlier this year, Amazon said it would close all of its Amazon 4-star, Books, and Pop Up stores, to focus more on its Amazon Fresh, Whole Foods Market and Amazon Go grocery and convenience stores, and its new Amazon Style apparel stores, in addition to underlying technologies like Amazon One and Just Walk Out.

Kumar, in an interview with GeekWire at Amazon’s re:MARS conference in June, said the company has gleaned new insights from third-party implementations of its in-store technologies, such as the need to let shoppers enter and log into a store using a credit card, not just an app, which is something Amazon then adopted, as well.

At the same time, Kumar said, Amazon remains committed to first-party physical stores as a business. He dismissed the notion that the company’s stores could become merely a proving ground for technologies to license to others.

“When we get into a particular business, we may try many different things, but the idea is that if customers like it, if we see the right feedback … and the right types of behaviors, then we double down and build more,” he said at the time.

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Amazon’s physical stores were created out of a recognition that the “overwhelming majority” of sales will continue to happen in physical stores in certain segments, including grocery and apparel, Kumar said.

Amazon last week said it’s rolling out the Amazon One palm recognition system to more than 65 of its Whole Foods Market stores in California, after launching in Seattle, Austin, and some Whole Foods locations in New York and L.A.

Despite assurances from Amazon on privacy, and options to use other checkout methods, Amazon One has faced concerns from some users and groups. One of Amazon’s early partners, Red Rocks Amphitheater in Denver, canceled plans to use the palm recognition and payment system at the popular music venue.

Other Amazon physical retail executives making the move to AWS, according to the memo, are Sanjay Dash, vice president of technology for physical stores; Jennifer Maul, general manager for Just Walk Out Technology; Barry Johnson, vice president, physical stores technology, Gerard Medioni, another vice president.

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