Amazon has subverted traditional industries and even changed the way the world consumes. But now we should prevent it from abusing its dominant position.
Twenty years ago, when Jeff Bezos quit his job in finance and moved to Seattle to start a new company, he rented a house with a garage, because companies like Apple and Hewlett-Packard were born there. Although he started selling books, he called the company Amazon because a huge river reflected his ambition. This week, the world's leading e-commerce company released its first smartphone, which Amazon regards as a communication device, rather than a clever shopping platform and a way to collect people's data in order to provide more accurate product recommendations.
When Jeff Bezos resigned from the financial industry and came to Seattle 20 years ago, he rented a house with a garage. Prior to this, giants such as Apple and Hewlett-Packard were born from such garages. Although Jeff started out selling books, he named Amazon after the widest river in the basin, which fully showed his ambition. This week, the world's leading e-commerce company launched its first smart phone, but in Amazon's view, its main purpose is not this kind of communication equipment, but to build a unique shopping platform and create a user data collection platform, so as to better understand customer needs and launch corresponding products.
Smartphones are typical of Amazon. There is also relentless expansion: if you can send books and washing machines, why can't you send a phone? Ability to switch between the real world of atoms and the digital world of bits: Amazon has one of the most impressive physical distribution systems in the world, even though it has expanded to cloud computing, e-books, video streaming and music downloading. The pursuit of market share exceeds the immediate profit. There is also a somewhat creepy feeling that Amazon already knows too much about its users. So far, its insatiable appetite has helped consumers; But as its scale and strength grow, the danger is that it will go too far.
This smart phone has the characteristics of Amazon. It is constantly expanding its business: if you can distribute books and washing machines, why can't you distribute mobile phones? It has the ability to convert between the real world and digital space. Amazon has the most admirable logistics system in the world, but it also extends to cloud computing, e-books, video streaming and music downloading. Compared with immediate interests, Amazon is more inclined to gain market share. I have to say that people think that Amazon's understanding of users is too detailed and even creepy. So far, although its demand for data is insatiable, it is still helpful to customers. But as Amazon's scale continues to expand and its capabilities continue to improve, the company may go too far to turn back.
Customers who bought this product also bought …
People who have bought this product have also bought …
At present, admiration should be more important than fear Many things that are now taken for granted by the world are introduced by Bezos. Entering your credit card number in a web browser was once considered a sign of madness, until Amazon showed how easy and safe online shopping is. Once people buy a book, they will try something else. Today, the global e-commerce market is worth $65,438+$0.5 trillion.
At present, people respect Amazon more than fear. Now many things that people take for granted come from Mr. Bezos. Entering the credit card number in the browser was once considered a crazy behavior until Amazon confirmed the convenience and security of online shopping. Once people successfully buy a book, they will want to buy more things. Today, the global e-commerce market share has reached10.5 trillion US dollars.
Amazon has also promoted the emergence of customer reviews. From the beginning, it allows buyers to evaluate and comment on books. This still annoys some professional critics, and some of the most annoying five-star ratings may come from the author's spouse. But on the whole, they provide valuable advice to buyers. Today, everything from applications to hotels to water pipes can be rated online, and retail websites seem incomplete without customer comments.
In addition, Amazon also gave birth to the user comment mode. Since its inception, Amazon has allowed buyers to rate and comment on books. This is still despised by some professional storytellers, and some over-praised five-star praise is likely to come from the author's relatives. But on the whole, this way can really provide some valuable suggestions to property buyers. Now users can evaluate everything from applications to hotels online, and even web pages without user evaluation will give people a feeling that something is missing.
Then there is the industry it subverts. Books come first. Amazon has changed the publishing industry twice-the first time to make any book in the world available quickly, and the second time to make e-books mainstream. Before Amazon launched the Kindle in 2007, e-readers were complex devices that few people used. Kindle is easy to use, can work anywhere, and allows it to be sent directly to the device immediately (rather than through a PC). Amazon has also pioneered a new model of cloud computing. In 2006, it began to rent computer capacity by the hour. The choice of renting computing power instead of buying it greatly reduces the cost and complexity of starting a new company. Amazon's cloud services have been used by startups including Netflix, Instagram, Pinterest, Spotify and Airbnb, and have spawned a whole new industry.
In addition, Amazon has subverted many industries, among which books bear the brunt. Amazon changed the publishing industry twice. Once it is convenient for people to buy books through online bookstores, and the second time it is convenient for people to read at any time through e-books. Before Amazon launched the Kindle in 2007, e-books were just a niche device. Because the Kindle is very easy to use, it can be used anytime and anywhere, and you can download books to the device immediately without the help of a PC. Amazon has also introduced a new cloud computing method. In 2006, we started renting computing resources according to time. This combination of rent and purchase greatly reduces the start-up cost and complexity of the company. Amazon's cloud services have also been widely used in startups such as Netflix, Instagram, Pinterest, Spotify and Airbnb, and even spawned some brand-new industries.
Apple may be famous as an innovator, but Amazon may have an equally great influence on the operation of the digital world. It's still experimenting. Unconstrained by the self-image of a company that does certain things, Amazon has dabbled in areas ranging from internet search to robotics to film and television development.
As an innovator, Apple is obviously better known, but Amazon seems to have a greater impact on the operation of digital space. And it's still being explored. But Amazon is not limited to a single business. In constant attempts, Amazon has developed from internet search to robots, from movies to TV production.
In fact, if your glasses are particularly optimistic, Amazon seems to have put "long-term" back into Anglo-Saxon capitalism. When Wall Street was addicted to quarterly results and stock repurchase, Amazon made it clear to shareholders that if it had to choose between profitability and investing in new areas, it would always choose the latter. While other technology giants are sitting on record cash, Amazon still has many ideas about investment and innovation. Investors seem to be satisfied with this: Amazon's price-earnings ratio sometimes exceeds 3,500 times. By paying a large number of shares to executives, it makes the interests of executives consistent with those of shareholders: its maximum annual salary is $65,438+075,000.
In fact, if you are optimistic enough, Amazon seems to be bringing a long-term perspective back to Anglo-Saxon capitalism. In today's Wall Street, where quarterly performance and stock repurchase are generally valued, Amazon has made it clear to shareholders that whenever faced with the proposition of short-term profits or investment opportunities, it will always choose the latter. While other technology giants are accumulating a lot of cash, Amazon is still trying to invest in innovation. Investors seem to be happy about this: Amazon's price-earnings ratio has exceeded 3,500 times. By using stocks as a means to pay shareholders, the interests of executives and shareholders are tied together: the highest annual salary of executives is $654.38+$7500.
A huge choice, a tiny tax bill
A huge choice, a small tax plan
The problem is that many of these advantages are accompanied by disadvantages. Amazon is accused of unfair competition-a bad employer, tax evasion and bullying competitors. Amazon said that the median wage in its US warehouses is 30% higher than that in large retail stores. In terms of taxation, the situation is slightly subtle. The main reason why its tax bill is so low is that it has no profit, but Amazon is also very active in (legally) booking profits from low-tax countries. It has been opposed to levying sales tax on online transactions for many years. Recently, it changed its attitude and now levies sales tax in more and more American states.
The problem is that there are still many shortcomings among these advantages. Amazon is accused of unfair competition, poor employment environment, tax avoidance and bullying competitors. Amazon said that its median wage in American warehouses is 30% higher than that of large retailers. There may be some subtle situations in taxation. Amazon's low tax rate is due to low profits, but it is undeniable that Amazon is also actively taking legal measures to transfer profits to countries with low tax rates. After opposing the online transaction tax for so many years, Amazon recently changed its attitude and began to collect business tax in more and more States in the United States.
As for bullying competitors, this is mostly just the savage magic of capitalism. Amazon destroyed local bookstores, but only in the way Tesco and Wal-Mart destroyed grocers-by offering cheaper and easier shopping methods. However, anti-monopoly regulators must examine each case to ensure that the company has not abused its market power. For example, Amazon's current dispute with Hachette, a large publisher, may be largely a standard struggle between retailers and suppliers. However, when the dominant e-book seller canceled the pre-order button and extended the delivery time of Ashett's books, this was not in line with Mr. Bezos' claim of paying attention to customer service.
As for bullying competitors, most of them are just brutal magic of capitalism. Like Tesco and Wal-Mart, Amazon destroyed local bookstores by offering cheaper and more convenient shopping methods. However, on the basis of this case, the anti-monopoly supervision mechanism must ensure that it will not abuse its market power. For example, Amazon's current competition with Hachette, a large publisher, may be largely a struggle between retailers and suppliers. However, when major e-book sellers delete the reservation button, the delivery time of Ashett books will be extended. This hardly accords with Mr. Bezos's emphasis on customer service.
Paradoxically, perhaps the biggest worry about Amazon is the result of its long-term vision. It is difficult to compete with a company whose shareholders don't expect it to make a profit. Its huge scale and willingness to make zero or negative profits are high barriers to entry for potential competitors. This can't last forever. Worryingly, Amazon is just waiting for its competitors to go bankrupt before raising prices. If this happens, the regulator should take immediate measures. This will provide an opportunity for another company, such as China's Alibaba, and some investors may regret that Amazon has never made a profit. But consumers will win again. In fact, as Bezos' combative startups extend their tentacles into many aspects of daily life, consumers usually win.
Perhaps, among many contradictions, the most worrying thing about Amazon is its long-term vision. It's hard to compete with a company whose shareholders don't even want to make money. Its huge scale and loss-making management attitude set a great threshold for potential competitors. But this situation will not last forever, and people are only worried about price increases after waiting for competitors to withdraw from the market one by one. If this happens, the regulatory authorities should intervene strongly. But it will provide opportunities for other companies, such as China's Alibaba. And some investors may abandon Amazon because the profit is far away. But consumers will benefit again, which has become the norm when Bezos' dynamic startups gradually penetrate into all aspects of our lives.