WHY IT’S HARD TO ESCAPE AMAZON’S LONG REACH
IN 1994, SOON after Jeff Bezos incorporated what would become Amazon, the entrepreneur briefly contemplated changing the company’s name. The nascent firm had been dubbed “Cadabra,” but Bezos wanted a less playful, more accurate alternative: “Relentless.” (Relentless.com redirects to Amazon.com to this day.) Twenty-four years later, perhaps no adjective better describes Bezos’ empire than the name he once wanted to give it.
The company is known as the “everything store,” but in its dogged pursuit of growth, Amazon has come to dominate more than just ecommerce. It’s now the largest provider of cloud computing services and a maker of home security systems. Amazon is a fashion designer, advertising business, television and movie producer, book publisher, and the owner of a sprawling platform for crowdsourced micro-labor tasks. The company now occupies roughly as much space worldwide as 38 Pentagons. It has grown so large that Amazon’s many subsidiaries are difficult to track—so we catalogued them all for you. This is our exhaustive map of the Kingdom of Amazon.
You might be wondering, why Amazon? After all, other tech firms, including Google and Facebook, have also expanded outside their core businesses in recent years. But few other companies can claim leadership in sectors as disparate as videogame streaming, online fabric sales, and facial recognition. Amazon also employs far more people than its competitors. Roughly 613,000 people work at Amazon, more than twice as many as work at Alphabet (94,000), Facebook (33,000), and Microsoft (135,000) combined. Most of those workers labor in one of Amazon’s more than 100 North American logistics centers, or at one of more than 450 Whole Foods stores.
Amazon employees are paid far less than other tech workers. In its annual filing with the Securities and Exchange Commission in February, Amazon reported its median worker earned $28,446 in 2017 (it says that number jumps to $34,123 for full-time US workers). Facebook’s median salary in 2017, by contrast, was more than $240,000.
A bit of context: It helps to know how Amazon makes money. While its retail business is the most visible to consumers, the cloud computing arm, Amazon Web Services, is the cash cow. AWS has significantly higher profit margins than other parts of the company. In the third quarter, Amazon generated $3.7 billion in operating income (before taxes). More than half of the total, $2.1 billon, came from AWS, on just 12 percent of Amazon’s total revenue. Amazon can use its cloud cash to subsidize the goods it ships to customers, helping to undercut retail competitors who don’t have similar adjunct revenue streams.
Amazon began as an online bookseller in 1994, and although it quickly expanded into other ventures, it still owns and operates multiple publishers and online bookselling subsidiaries. Nowadays, most of these fall under the umbrella of Amazon Publishing, which is both a publisher and the owner of imprints for specific genres, languages and locales.
Amazon imprint Thomas & Mercer publishes mysteries, thrillers, and true crime novels; Little A handles literary fiction and nonfiction; AmazonCrossing is responsible for translated texts; 47North does science fiction and fantasy; Skyscape is for teen and young adult books; there’s Two Lionsfor children’s books; Jet City Comics for, well, comics; Montlake Romance handles—you guessed it—romance; Waterfall Press publishes Christian fiction; Grand Harbor Press is responsible for a category Amazon describes only as “inspirational;” Lake Union Publishing handles “book club fiction;” Amazon Original Stories publishes short stories and nonfiction 1; AmazonEncore is for “rediscovered works;” and TOPPLE Books spotlights works selected by Jill Soloway. Amazon also has acquired Avalon Books, The Book Depository, BookFinder, Westland Books, and AbeBooks.
In 2005, Amazon acquired BookSurge, an on-demand self-publishing service, and CustomFlix, an on-demand video publishing service, which was later renamed CreateSpace. Two years later it bought independent audiobook producer, Brilliance Audio, and launched its own e-book publisher, Kindle Direct Publishing, concurrently with the first Amazon Kindle e-reader. Soon after, the company paid $300 million to acquire audiobook seller Audible. It also owns ACX, an audiobook publishing company.
In 2009, Amazon merged BookSurge and CreateSpace to provide more on-demand options for publishers; the merged company did business under the name CreateSpace, but was officially named On-Demand Publishing. Four years later, Amazon purchased the book-review site Goodreads, which it later merged with Shelfari, a different book cataloging social network the company purchased in 2008. In 2014, Amazon acquired digital comics distribution platform ComiXology. The following year, it launched Amazon Rapids, a subscription-based app that presents short children’s stories in the form of fake text messages. In 2018, CreateSpace was merged with Kindle Direct Publishing, which now handles all e-book and paperback publishing services, while all media services were transferred to another new company, called Amazon Media on Demand, which is responsible for manufacturing and shipping disc content. Amazon also operates a digital Kindle Store, where customers can purchase ebooks and other content for the Kindle, and more than a dozen physical Amazon Booksstores.
In 1998, four years after its founding, Amazon bought IMDb(Internet Movie Database) and expanded into music, offering users more than 125,000 titles at launch on CDs and DVDs. The following year, Amazon acquired Alexa Internet, a web-traffic-analysis company not to be confused with the other, more popular Alexa that came later. It wasn’t until 2007 that Amazon launched its streaming service, which was originally called Amazon MP3 and later changed to Amazon Music. In 2006, the company launched Amazon Unbox, a service for purchasing and downloading videos, which was later changed to Amazon Video on Demand, then Amazon Instant Video, and finally Prime Video (which is also, confusingly known as Amazon Video). Prime Video showcases content by Amazon Studios, which began in 2010 as a script development entity but now produces and distributes television series and films. (Last year Amazon bought the TV rights to make a Lord of the Rings spinoff for an estimated $250 million.) Through IMDb, Amazon purchased Withoutabox, which streamlined the submission and selection process for film festivals (and which Amazon is in the process of closing), as well as Box Office Mojo, which algorithmically tracks box office revenue, in 2008.
In early 2014, Amazon acquired American videogame developer Double Helix Games and renamed it Amazon Game Studios. Shortly after, Amazon bought popular live-streaming platform Twitch for $970 million, and Curse, a gaming information and communication platform with a robust community of users. Shortly after the acquisition, all Curse accounts were transferred to Twitch, boosting the platform’s user base. In 2015, Amazon launched Amazon Tickets, which sold tickets to concerts and other live events in the UK (it shuttered the service in March 2018).
Amazon also owns sites that provide educational resources, including Amazon Inspire and TenMarks.com (Amazon is winding down the latter). It also has Whispercast, a service designed to help educators share audiobooks.
Lastly, for some reason, Amazon also owns DPReview, a digital camera website.
Over 6 million independent merchants pay to sell goods through Amazon’s ecommerce marketplace and many also shell out additional fees for services like shipping and warehousing. Amazon also sells its own products through dozens of house brands, including Mountain Falls (primarily personal care products), Rivet (furniture), and Daily Ritual(women’s clothing). Amazon Basics offers Amazon-brand alternatives to popular marketplace products.
Merchants also may pay to place ads on Amazon through Amazon Advertising; the company is now the third-largest digital-advertising platform, behind Google and Facebook, with an estimated 4.2 percent market share. The company also has Amazon Vine, an invite-only program for trusted reviewers, who are provided new products for free in exchange for sharing their opinion.
Need some cash to start your Amazon selling business? Amazon Lending, another invitation-only program launched in 2011, has doled out billions in loans to businesses that may have difficulty obtaining credit elsewhere.
Nestled within Amazon.com are businesses such as $119 per-year Amazon Prime, which began in 2005 as a subscription service offering free two-day shipping—but quickly ballooned into something much larger. In addition to Prime Video and Prime Music, Amazon launched a photo-storage service called Amazon Photos in 2014, giving users access to Amazon Drive a cloud-based file-storage service. Other Prime products include: Prime Reading, a rotating ebook loan service unrelated to Amazon’s other Kindle offerings; Prime Pantry, which ships non-perishable grocery items for an additional fee; Amazon Fresh, a grocery delivery and pickup service; Prime Now, a one-to-two hour direct delivery service for Prime members in certain cities; and Amazon Restaurants, which offers food delivery, among others. While Prime Now offers one-hour delivery for an additional fee, most of these services are included with a Prime membership.
There’s also Amazon Warehouse, for deals on used products, Amazon Renewed, for refurbished products with a warranty, and Amazon Second Chance, also for second-hand goods. Lastly, there’s Subscribe with Amazon, which lets customers sign up for subscription services like monthly boxes of snacks. Need someone to paint a wall or clean your carpet? There’s Amazon Home Services, a marketplace for hiring home-repair and cleaning professionals.
To hire and manage the contract workers making deliveries, Amazon created Amazon Flex; you can also start your own logistics firm through Amazon via Amazon Logistics. The company has its own payment processor, Amazon Pay, which was launched in 2007. Earlier this year, Amazon acquired the popular Indian payment platform Tapzo for $40 million, and then immediately said it would shutter it and shift users to Amazon Pay.
In one of its highest-profile acquisitions, Amazon last year purchased Whole Foods, the high-end grocery store chain with hundreds of locations. Earlier in 2018, it also bought a 49 percent stake in More, one of India’s largest grocery chains. Amazon simultaneously operates its own chain of partially automated grocery stores, known as Amazon Go, which use ceilings’ full of cameras to offer customers a checkout-free experience. It also operates three 4 Star Stores, where customers can purchase products rated 4-stars and above on Amazon Marketplace, and a fleet of Treasure Trucks scattered around the country, doling out everything from steak to Philips Hue lights in a bizarre spinon the traditional food truck model.
Aside from traditional ecommerce, Amazon also owns Amazon Mechanical Turk, a site where organizations can hire individuals to complete piecemeal tasks, such as labeling data for machine learning algorithms. Started in 2005, Mechanical Turk is favored by academic researchers for collecting survey and experimental data.
Amazon Web Services
In 2003, Amazon launched its web hosting business, Amazon Web Services. The unit begun several years earlier as Merchant.com, which helped other retailers such as Target and Borders build their own online shopping sites using Amazon’s e-commerce tools. In 2006, the company launched Amazon S3 a “simple” cloud storage service and hosting provider that as of 2013 stored more than two trillion digital objects, as well as Amazon Elastic Compute Cloud (better known as EC2), and Amazon Simple Queue Service. Reddit, Tumblr, Netflix, Pinterest, and Dropbox have all used Amazon S3 as their primary host or storage provider at one point over the past decade. (This article is also powered by Amazon, as WIRED’s website runs on AWS.)
AWS offers so many cloud computing products and services that it would be cumbersome to name them all. In 2011, Amazon introduced AWS GovCloud, aimed at government agencies. Four years later, it launched AWS IoT, a platform for connecting and managing the plethora of connected devices known as the Internet of Things. Shortly after, the company won a $600 million contract to build AWS Secret Region, a cloud storage service for the CIA.
In 2015, Amazon purchased Shoefitr, a startup, that uses 3-D technology to help customers determine their shoe size while shopping online, and Safaba Translation Systems, a machine-translation startup. In 2017, the company acquired3-D body scanning and modeling company Body Labs, and game developer platform GameSparks. Research conducted by these two latter companies was used to flesh out Amazon’s expansion into augmented and virtual reality, which is primarily covered by Amazon Sumerian, an AWS service. That same year, AWS acquired both the mobile video company Elemental Technologies and Israeli semiconductor maker Annapurna Labs . Around the same time, Amazon bought AI-security startup Harvest.ai and Sqrrl, a cybersecurity startup that was spun out of the NSA.
AWS also offers controversial facial-recognition software known as Amazon Rekognition, which is used by some law enforcement agencies and has also been pitched to Immigrations and Customs Enforcement. The service has drawn criticism for being inaccurate, particularly when used to identify people of color. In a test, the ACLU found that it incorrectly matched 28 members of Congress with people who had been arrested for a crime.
Energy and Transportation
To power all those data centers, Amazon has contracted with multiple renewable energy companies to create more than a dozen wind and solar energy farms in Indiana, Virginia, Ohio, and North Carolina. In 2017, it finished construction on its largest wind farm yet, the Amazon Wind Farm Texas, an achievement that Bezos celebrated by smashing a bottle of champagne on top of one of the farm’s 300-plus-foot tall wind turbines in an ultra-dramatic video:
— Jeff Bezos (@JeffBezos) October 19, 2017
Amazon also owns a fleet of Prime Air Cargo Planes and is facilitating ocean freight shipments. In addition, Amazon has been working on an army of Prime Air Drones since 2013. The project is still in its early stages, though the company first delivered a package to an English customer via drone in 2016.
In 2004, Amazon opened Lab126, a computer hardware research and development unit. The Sunnyvale, California-based laboratory has created some of Amazon’s most successful products, including the Kindle in 2007 (and its many updated versions), the Kindle Fire Tablet in 2011, the Amazon Fire TV and Fire TV Stick in 2014, the Amazon Echoin 2015, and the smaller Amazon Echo Dot in 2016. Another Alexa-equipped device, the Echo Look, is a camera contraption that provides fashion advice. Lab126 was also responsible for the Amazon Fire Phone, which was a commercial failure.
In 2012, Amazon acquired robotics firm Kiva Systems, for $775 million, which it later renamed Amazon Robotics. After the acquisition, Amazon ended Kiva’s contracts with other companies like Staples and Crate and Barrel, leaving Amazon warehouses as the sole beneficiary of the technology.
In 2017, Amazon launched Amazon Key, a service that allows Amazon workers to deliver items inside a user’s home by making use of the Amazon Cloud Cam security camera, a compatible smart lock, and the Amazon Key app. Soon after, Amazon acquired Blink Home, a home automation company that makes security cameras and a video doorbell, as well asRing, best known for its smart doorbell, which includes a video camera, motion sensors, and other remote controls. Amazon also expanded Amazon Key delivery to the trunks of users’ cars, for some reason, with a service oh-so-creatively called Amazon Key In-Car.
In 2014, Amazon started a secret internal lab dedicated to developing healthcare technology that goes by at least three different names, depending on who you ask: 1492, The Amazon Grand Challenge, and Project X. As of late, the project has reportedly partnered with the Fred Hutchinson Cancer Research Center in Seattle to explore using machine learning to prevent or cure cancer, and is pitching health insurance companies on a new product called Hera, which mines patient medical records to flag incorrect codes and potential misdiagnoses, and help hospitals bill patients. Amazon also sells medical supplies to hospitals through a healthcare offshoot of its business-to-business marketplace, Amazon Business.
Amazon has been hiring high-profile doctors, primary care specialists, and healthcare law experts. In the first quarter of 2018, Amazon hired more than 20 people with healthcare experience, including employees poached from CVS Health and UnitedHealth Group. In January, Amazon partnered with JPMorgan Chase and Berkshire Hathaway to create a new, still nameless company ostensibly designed to improve healthcare and cut costs. In August, CNBC reported that Amazon plans to open primary care clinics at its headquarters in Seattle. In June, Amazon bought online pharmacy PillPack, a startup that ships medication directly to customers, for $1 billion.
Amazon CEO Jeff Bezos owns an equally ridiculous array of companies and ventures outside of Amazon. There’s Nash Holdings, which acquired the Washington Post for $250 million in 2013. Bezos also owns Bezos Expeditions, which manages his venture capital investments. The entity is responsible for spaceflight services company Blue Origin, numerous charitable organizations, a project to recover the Apollo F-1 Engine from the depths of the ocean, and the 10,000 Year Clock, under construction inside a mountain in Texas and designed to last for 10,000 years.
This article first appeared in www.wired.com
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