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Magento Just Got Easier for Merchants in Post-eBay World

Merchants using the popular Magento ecommerce software to power their online store have to figure out how to host it, whether it means buying their own hardware servers or using a web-hosting company. But now it’s adding a cloud-based store-hosting option with the launch of Magento Enterprise Cloud Edition, and removing some of the challenges in setting up and maintaining a Magento store in the process.

Magento has long provided its open source software in two flavors, both of which remain available: the free Community Edition and the paid Enterprise Edition. Magento has not revealed pricing for the new Magento Enterprise Cloud Edition.

It’s interesting to note that in 2011, when still owned by eBay, Magento launched a cloud platform for small sellers called Magento Go that cost $15/month, but eBay shuttered the Magento Go and its own ProStores store-hosting services in 2014. eBay spun off Magento as part of the sale of eBay Enterprise last year.

Peter Sheldon, Head of Strategy at Magento, said the company can now focus purely on the Magento ecosystem and merchants without the distractions and politics that came from being owned by eBay. Magento is now backed by a private equity firm, he said.

This week’s introduction of Magento Enterprise Cloud Edition is game-changing. The “platform as a service” runs on Amazon Web Services (AWS), making storefronts scalable. It takes the headache away for merchants, Sheldon said.

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Magento Enterprise Cloud Edition starts becoming attractive for merchants doing more than $1 million in gross merchandise volume annually – the typical sweet spot is between $50 million – $400 million, he said.

Later in the year, Magento will introduce lower price tiers to make the Cloud Edition accessible to more sellers.

Magento Marketplace
Because of the nature of open source software, merchants relied on Magento Connect for “extensions” – tools offered by third-party developers that work with Magento software.

This week, Magento announced it was launching a “next-generation commerce applications marketplace” called Magento Marketplace – a sort of app store for Magento 2.0.

On the one hand, Magento will vet and curate the apps, on the other hand, developers will pay Magento based on a revenue-share model.

Sheldon said there are 8,000 extensions in Connect, which is overwhelming for merchants and problematic for developers who have to deal with the problem of plagiarism from rivals. There might be 23 extensions that did the same thing, he explained. Revenue generated from apps in the Magento Marketplace will go back into the investment and the resources they are putting into it, he said.

With Marketplace, there will be a higher bar of entry. “It’s a big win for merchants,” Sheldon said.

While they plan to retire Connect, it won’t happen immediately. “The existing Connect site will be available as we review and migrate extensions over to the new Magento Marketplace.”

“Connect will not be discontinued until we are confident that we have all merchant needs covered with Marketplace,” he said.

Quarterly Releases
A third piece of news: Magento launched 2.0 in November and committed to quarterly releases. The first incremental release, 2.1, announced this week and available later this quarter, offers new features and capabilities.

One key new feature is a staging and preview feature. This would allow a merchant running multiple campaigns to set up a calendar of events and preview the changes. Merchants can “jump in a time machine and see what their site will look like next Tuesday,” for example, and can do QA.

There are a number of other smaller changes to functionality to the search engine and payments, he said.

“We’re sticking to our commitment of quarterly releases,” Sheldon added.

Magento released the news at the Magento Imagine conference taking place this week in Las Vegas.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.