The nation’s largest grocery store chain, Kroger, is moving to the cloud.  But, it has decided to stay away from Amazon Web Services (AWS). Instead, it has decided to give millions of dollars to Microsoft and Google for using their cloud services.

This pattern is something that we’ve come to see across many retail giants. A few months back, there was a big tussle between Walmart and AWS, where the former asked its IT providers to avoid using AWS.

This stand-off between AWS and leading grocery chains continues with Kroger deciding to park its data and applications in Microsoft and Google. This move is likely to counter the foray of Amazon into different industries, including retail grocery.

In one sense, it’s not right to blame Walmart, Target or for that matter, Kroger, because if Amazon enters the retail grocery market, then it becomes a direct competitor for the others. So, it makes no sense to keep data on a competitors storage service.

For Kroger, the entry of Amazon poses a direct threat. And that’s because Amazon wants to enter the pharmacy market and reduce the prices of generic medicines. That’s not good news for Kroger because it gets about nine percent of its total sales from its 2,200 pharmacies. If Amazon enters and disrupts this market, then it can affect the profitability levels of Kroger.

If you remember, that’s exactly what Amazon did with Whole Foods. It bought the company for $13.7 billion and immediately slashed the prices of this upscale grocery chain. So, if it does the same with pharmacy, it can put Kroger in a difficult financial spot.

This strategy seems to apply only to new initiatives, as Kroger already has a few projects on AWS.

But, it doesn’t seem to affect AWS in any way as it announced another stellar quarter where revenue surged by 42 percent.

In the meanwhile, it’s great news for Microsoft and Google that are looking to catch up with AWS.

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