Report: Wal-Mart's Big Data Moves Will Boost Rackspace

Last week while the OpenStack conference was taking place in San Diego William Blair analyst Jim Breen reported that event organizer Rackspace (RAX) will likely win more business from retail giant Wal-Mart (WMT).

OpenStack and @WalmartLabs

Breen noted that Wal-Mart was actively recruiting OpenStack engineers and the fact that Rackspace can gain traction with Wal-Mart for big data analytics reflects the progress of the OpenStack platform. Rackspace and Wal-Mart share a common enemy with Amazon.  Wal-mart has opened an office in San Bruno, California office to house @WalmartLabs, an innovation outpost that the brick-and-mortar company hopes will expand its Internet retail business and play ecommerce catchup with Amazon.  @WalmartLabs is in the process of consolidating its data analytics systems from EMC and IBM technology into a single global platform.

"The new central global platform will allow data scientists from its various Web properties to analyze petabytes of real-time customer data and generate insights," said Breen. "(Our) checks indicate that a portion of the infrastructure for this consolidated platform will use OpenStack in private and public cloud configurations. For the public cloud, Rackspace is being used. We believe that the opportunity with Wal-Mart has the potential to scale over time, and could lead to Big Data projects with other large retailers."

Searching for Big Data

In April 2011 Wal-mart acquired a social media startup Kosmix. The California @WalmartLabs consists of around 50 people acquired from Kosmix, who have since been working on algorithms that imporve and personalize search results by categorizing words and understanding them in context. Wal-Mart's search engine, Polaris, was unveiled last August and is what powers Walmart.com as well as company mobile web and mobile apps. It uses semantic search algorithms that can understand some of the meaning behind a search query.

The tagline at the @WalmartLabs site of "Social + Mobile + Retail" indicate where its technology will be focused. With a plethora of data streaming from retail operations, numerous social network feeds and mobile devices the company has a lot of big data to crunch. Current job openings call for Big Data Systems Engineers to leverage multi-petabyte data sets  work with Hadoop, MapReduce and other large scale analytics systems. WaL-Mart also uses the DataStax, an enhanced Hadoop distribution that utilizes Cassandra for many of its core services. DataStax recently raised $25 million in a third round of funding, and appointed former Sea Micro CEO Andrew Feldman to its board of directors.

Rackspace will announce its third quarter 2012 financial results on November 6, 2012.