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Inside Amazon’s Quest for Global Domination

12 January 2018

From The Wall Street Journal:

Amazon, Video

17 Comments to “Inside Amazon’s Quest for Global Domination”

  1. As always, I’m amused when a video on Amazon world dominance has a scene with Alexa where my own Alexa device responds and echoes the answer.

    Guess Amazon already dominates my office…

  2. First of all, that’s a great video. I’m in video production, and I love that video. Thumbs up for production.

    But, GAWD do I hate misleading stats. Amazon does not get $.41 of every dollar online unless you count Marketplace, where Amazon is NOT THE SELLER. I repeat. AMAZON IS NOT THE SELLER. They are, at most, providing logistics to other companies selling their products to us. This is so entirely not the same thing.

    Currently, 50% of all paid units in the US on Amazon go to Marketplace sellers. Amazon makes a percentage of that, but that’s not online sales money. That’s a logistics transaction, like contracting UPS to ship something from your home. Or PayPal’s fees when you sell something through their Buy Now buttons.

  3. Video? What video? All I see is a big blank area under the headline.

    • Sorry for the delay in responding, Patricia.

      You might try using a different browser – Firefox if you’re not seeing anything when you use Chrome, etc.

      • It’s the same browser I always use: SeaMonkey, which is a lot like Firefox. I’ve never had a problem before.

        • Its in an iframe tag, which is blocked in some browser’s default security settings, since it is linking to content on a different server. I have no idea how you’d check that in SeaMonkey, but its a fairly common way to show video.

          • I don’t know what an iframe tag is. In the past I’ve sometimes had trouble with a video because flash was removed from my computer, but I have it installed now. With it installed, the only video I sometimes have problems with is video on some Amazon product pages (I get a message to install some software that I think has “bright” in the name) — but in those cases I see a video screen. Here, it’s just a blank, but only with this specific video.

  4. Just another ‘The Wall Street Journal’ whine that Amazon isn’t doing things the way ‘The Wall Street Journal’ (and some day-trading investors) wish they would do things (for more profit!)

    • Terrence P OBrien

      Amazon makes huge economic profits that are reflected in the stock price. For example, the entire Amazon Web Services operation is profit. It didn’t exist a few years ago. It now exists, and stockholders own it.

      People look at the financial accounting profit and conclude Amazon has very low profits. They are right about what the financials say, but dead wrong about the lack of profits.

      At the very basic level, profit is the value one gets from an endeavor less what they put into an endeavor. The first guy who sat on a rock and sharpened a stick put in an hour of labor. The tool he got was worth much more, and he never heard of Generally Accepted Accounting Principles.

      • That interpretation of accounting numbers has to be one of the goofiest ideas in history, but yeah, it’s everywhere.

        1) Company A has revenue of $1 million, has fixed expenses (inventory, wages, taxes, etc.) of $400,000, and spends $500,000 on expanding the product lines sold, buying real estate, or similar reinvestments.

        2) Company B has revenue of $1 million, has fixed expenses of $400,000, and spends $500,000 on free cocaine and strippers for the executives.

        Using “goofy accounting”, both of these companies have the same profit, $100,000, but which of the two would anyone sane want to invest in?

      • “For example, the entire Amazon Web Services operation is profit.”

        You’ll have to explain that to me. I agree that Bezos figured out how to monetize something he was forced to build out to maintain his online business, but entirely profit? That seems a stretch. As as example, I know a half dozen or so engineers who work for AWS helping AWS customers take advantage of AWS services. They are a cost, not a profit. If you mean “all AWS profits are profits” that’s a tautology equivalent to “all MSFT profits are profits.” I am sure that is not what you mean.

        • You’ll have to explain that to me.

          AWS was created by putting cash flow into the AWS business rather than into stockholders pockets. AWS has value. It represents wealth.

          Investors think Amazon can invest money better than they can are attracted to its stock.

          The most important part of Amazon’s financial statements isn’t the profit line. It’s the cash flow line, especially the free cash flow.

          • Put another way: when Amazon.com began producing profits Bezos spent the money building AWS instead of letting the cash pile up in offshore banks.

            When people tally up the value of, say Apple, they include $250B worth of cash. When people properly tally up Amazon its value includes AWS and all the businesses they’ve built or bought.

            Apple’s cash stash keeps growing because its management has no better use for it. Amazon’s cash stash is minimal because Bezos keeps finding new uses: AWS, LAB126, WHOLE FOODS, WAREHOUSES, CARGO JETS, BOOKSTORES, ALEXA, etc. In time those investments will bring in profits of their own and increase the value of Amazon even more just as Apple’s stash grows by earning interest.

            Apple keeps their profits in liquid form while Amazon keeps theirs in tangible assets. Eventually Apple will amass enough cash to buy a small country while Amazon will have built a small country.

            The approaches are different but the outcome is similar. Both companies create value for their shareholders from the assets they own.

  5. Amazon is exposing inefficiencies everywhere, and being the first to exploit many of them. It doesn’t create the inefficiencies – it solves them.

    Except that I haven’t yet figured out how to make their system sell my books better (I’m working on that), what’s not to like?

    It’s not perfect. It’s just perfect-er.

    • “It’s not perfect. It’s just perfect-er.”

      Which is what annoys ‘The Wall Street Journal’ so dang much! 😉

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