For all of the hype over its shopping spree of acquisitions in recent years, Expedia didn't have much to show for it compared to rival Booking Holdings. That's starting to change, and Expedia feels it's ready for a cloud-based future.
Expedia has been bogged down with acquisitions and tech migrations in recent years while Booking.com and Booking Holdings beat Expedia for a string of consecutive quarters. But those days are numbered as Expedia reaps the rewards of its multi-year cloud migration project, according to Tony Donohoe, outgoing Expedia chief technology officer and senior vice president, speaking at the inaugural Skift Tech Forum Tuesday in Santa Clara, California.
“We were upgrading networks, infrastructure, and hardware that was not at the same pace [as Booking],” said Donohoe. “We’ve reached a tipping point with our current platform in Amazon Web Services.”
Donohoe couldn’t confirm where he’s going but said he believes Expedia’s best days are still ahead of it.
The Amazon Web Services project, which Expedia began in 2012 and expanded last year, signals a travel industry trend that comes along once every 10 to 20 years, said Donohoe.
Expedia has been able to put more traffic on its sites than it could have done before, said Donohoe. “The velocity of your engineering organization will go way through the roof when you can use a cloud provider,” he said.
“Historically, you would have your own data center and if you wanted to do something new you’re typically doing six month lead times with thousands of servers,” said Donohoe. “That’s assuming the best-case scenario for that project. Now you just pay on-demand for what you use which is game-changing.”
Amazon Web Services has also helped Expedia deploy its applications around the world with the tap of a button, which was impossible with a legacy data center. Expedia CEO Mark Okerstrom said last year that some 80 percent of its mission-critical apps will be in cloud-based platforms within a few years.
“It’s more resilient and secure,” said Donohoe. “And what they’re essentially doing is consolidating some of the core and harder to find skill sets such as networking security into these cloud providers. You can scale up and scale down like you could never do before.”
The project, however, was a bit of an unknown at the start, said Donohoe.
“Every quarter the project was different because you’re doing something you understand but you’re still doing it for the very first time,” said Donohoe. “We had to be very agile for the first year. The main benefit was that it energized our engineering organization so much because they could move faster.”
Donohoe said in some ways, getting the talent and expertise for this kind of project is more difficult. “You have to have the whole package as an engineering organization to attract the talent, retain the talent, build what is needed for everyone, and understand an entire ecosystem,” he said.
“In prior years, you wouldn’t have to do that,” said Donohoe. “You would hand it off to someone and they would know. Now engineers have far more leverage to do everything end to end and those engineers still aren’t easy to hire.”
Donohoe also said search engine marketing is an area the travel industry will start to see Expedia and Booking on a level playing field. He said Booking built its brand in Europe based on search engine marketing and saw that opportunity early on.
“[Booking] got big because they had to go and do that,” said Donohoe. “They had an incentive to figure that out. We were based in the U.S. and maybe didn’t feel the need to do it as quickly as them and we have caught up.”
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Photo credit: Skift Executive Editor Dennis Schaal, left, interviews Expedia Chief Technology Officer Tony Donohoe on Tuesday at Skift Tech Forum. Skift