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Microsoft and Walmart to Bring in Automated Checkout Overtaking Amazon

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In a recent move to further revolutionize retail outlets across the country, Microsoft Corp is developing a new technology that’s going to reduce waiting time at the long checkout lines in stores. You no longer have to burden yourself with heavy shopping and wait in long queues while checking out.

The new system that is under development track what shoppers add to their carts. Microsoft has been going to various retailers around the world, showing the sample technology and has also approached Walmart Inc (WMT.N) for a possible collaboration in the future, according to a source.

The new technology aims to eliminate cashiers and checkout lines from stores, to outshine Amazon Go, a super-automated store. All an Amazon customer needs to do is scan their smartphones at a turnstile to enter. Everything that’s picked from the shelves by the customer is identified and cataloged by the specially developed sensors and cameras. Even the billing is automated, with Amazon billing their credits on files, customers no longer need to stand in queues for billing and can simply leave the store once they are done shopping.

Amazon Go, which is soon branching out in Chicago and San Francisco, has taken the competition a notch higher, with rival companies hurrying to come up with something as innovative. Broadly speaking Microsoft has the potential to provide tough competition to Amazon, also ranking No. 2 behind Amazon in selling cloud services that are critical to running e-commerce sites.

There is no official tentative date as to when Microsoft automated checkout will roll out, if at all. Or whether its technology will satisfy the retailers. But it’s speculated that this new tech will bring some change into the retail market, and compete with Amazon’s superiority along with making many people lose their jobs.

In a recent report, Gene Munster, Head of Research at Loup Ventures in Minneapolis, said: “This is the future of checking out for convenience and grocery stores,”. With cashiers being one of the most commonly held jobs in the United States, the venture capital firm estimates that U.S. market for automated checkout is worth $50 billion.

With Walmart and Amazon declining to comment, Microsoft too decided to keep tight-lipped and has reportedly said that it does not comment on rumors and speculation.

Expensive equipment

An insider said that the entire project to date has largely been headed by Microsoft’s Business AI (artificial intelligence) team. A group of think tanks, consisting of 10-15 people, has worked on a variety of retail technologies and have presented their innovations to CEO Satya Nadella.

In a previous meeting with the team several months ago, Nadella suggested an “intelligent edge” device that could sync and manage connected gadgets such as cameras on site with minimal data transfers to the cloud thus cutting down costs, said the source.

Microsoft needs to keep in mind the grocers’ already thin profit margins and come up with an innovation, that’s cheap enough to meet ends. Which will be challenging.

Microsoft recently showcased the basics for automated checkout at its Retail Experience Center in Redmond. It already has half a dozen partners, including Redmond-based AVA Retail, who is coming up with its own checkout-free or related services supported by Microsoft cloud, according to reports. Depending on the partners’ services’ sales, Microsoft’s cloud revenue will be fuelled and will also give an insight into the market, thus opening windows for further innovations.

Meanwhile, trying hard to catch up, Microsoft’s internal team comprising of a computer vision specialist from Amazon Go, has worked on attaching cameras to shopping carts to track customers’ items and designing new ways for smartphones to play a role in the shopping experience.

Amazon has said it has no recent plans to introduce the checkout-free technology to its Whole Foods Market grocery chain, which it acquired last year. The company is still hard at work at improving the service.

Amazon Vice President Dilip Kumar told Reuters in an interview earlier this year that the company is training computers to identify items or activities with as little information as possible.

“It’s a really hard problem,” said Scott Jacobson, managing director of Madrona Venture Group, adding it’s “one that Amazon is uniquely positioned to solve.”


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