Tag: Amazon

Fire disaster was a good thing claims Bezos

Hindenburg3Budget bookseller Jeff Bezos has been telling the world that the Fire Phone disaster was good for the company.

Amazon’s wizard idea to start flogging a smartphone, the Fire Phone, was a major flop that cost the company hundreds of millions of dollars.

But according to Amazon CEO Jeff Bezos, the Fire Phone was a “tiny little blip” compared to some of the larger experiments his company is working on now.

“If you think that’s a big failure, we’re working on much bigger failures right now. And I am not kidding. And some of them are going to make the Fire Phone look like a tiny little blip,” Bezos said.

He said that the size of mistakes needed to grow along with the company, Bezos said. “If it doesn’t, you’re not going to be inventing at scale that can actually move the needle.”

The great thing is when you take this approach, a small number of winners pay for dozens, hundreds of failures. And so every single important thing that we have done has taken a lot of risk taking, perseverance, guts, and some of them have worked out, most of them have not, he said.

Other failed projects included the hotel-booking site, Amazon Destinations, and auction site, Amazon Auction. But it’s also led to massive successes, such as its Amazon Web Services and the Amazon Echo, which is why Bezos likes to call the company “the best place in the world to fail”.

 

Trump threatens Amazon with antitrust charges

trumpuckerComedy US presidential hopeful Donald Trump has threatened that Amazon will be facing antitrust charges if he is elected.

Trump claims that Amazon.com, the world’s biggest online retailer, has “a huge antitrust problem.” Trump also said Amazon Chief Executive Jeff Bezos, who owns the Washington Post, is using the newspaper to influence politicians in Washington to help Amazon on taxes.

“The Washington Post is owned as a toy by Jeff Bezos, who controls Amazon. Amazon is getting away with murder tax-wise. He’s using the Washington Post for power so that the politicians in Washington don’t tax Amazon like they should be taxed,” Trump said.

“He’s using the Washington Post … for political purposes to save Amazon in terms of taxes and in terms of antitrust,” Trump said.

“He thinks I’ll go after him for antitrust. Because he’s got a huge antitrust problem because he’s controlling so much, Amazon is controlling so much of what they are doing,” Trump said.

Clearly he does not really care that he just gave Amazon a reason to sink as much money as is reasonable into rival candidates, but then again he has a lot of money already.

 

Amazon’s business market makes a billion.

scrooge-mcduckAmazon’s business marketplace, which connects businesses with suppliers, has made $1 billion in sales in its first year.

Amazon Business offers US businesses exclusive pricing and discounts for buying in bulk, free two day shipping for orders of more than $49, tax exemption and the option to get products delivered with an Amazon guarantee.

Amazon Vice President Prentis Wilson announced that the outfit was continuing to grow at a rate of 20 percent month-on-month.

The business marketplace, which Amazon has described as one of its important areas for growth, extends its role as a middleman for third-party vendors, which account for more than 40 percent of the company’s sales.

This also helps Amazon gain an edge in the fast-growing online business-to-business sector, which is set to account for about 12 percent of B2B sales in the United States by 2020

Amazon added more than 30,000 sellers and more than 300,000 businesses to its platform in the past year and continues to add “thousands of customers” every week.

Amazon’s customers on the platform range from companies like Cardinal Financial Corp to consumer products makers like Henkel & Co HNKG_P.DE and institutions like the University of California-San Diego and the University of Illinois.

Some of the most widely sold products on the platform include computer and information technology equipment, office supplies, lab equipment and food service supplies.

Amazon Business is beta testing to offer to extend lines of credit to businesses that register on its platform.

These lines of credit could range from tens of thousands of dollars up to $1 million, Wilson added.

 

Amazon makes a killing

AmazonOnline bookseller Amazon has made a killing and swept away analysts’ estimates and dusted the mantelpiece of doubts about the online retailer’s investment spree.

JP Morgan analysts muttered in a research note that whatever Amazon was doing it appeared to be working.

“While it’s tempting to try to pull out each component of Amazons  strong 1Q and generally recent performance, we think it’s the combination of many factors – the ‘Amazons Flywheel’, Prime, a growing distribution footprint, getting closer to customers, 3P (third party), AWS … the list goes on,” a JP Morgan analyst grumbled.

The “Amazon Flywheel” was Jeff Bezos’ cunning plan of offering the biggest selection of goods at the lowest prices and providing the best customer experience to create a “positive feedback loop” – whatever that is.

Amazon is also known for making bold investments in new business areas even at the expense of profits – a strategy that is often criticised by investors.

“We believe these results are further evidence that Amazon’s investment in infrastructure, logistics, and Web services is accelerating market share gains, cash flow growth and continued high returns on invested capital,” Goldman Sachs analysts wrote in a client note.

Revenue in Amazon’s three main businesses – online retailing in North America, international online retailing, and cloud business Amazon Web Services – swelled 27 percent, 26 percent and 64 percent respectively.

The company also offered a bright outlook, with revenue guidance for the current quarter of $28 billion to $30.5 billion, compared with the $28.33 billion analysts expected.

AWS, launched 10 years ago, delivered more profit in the first quarter than Amazon’s retail business.

While AWS is Amazon’s fastest-growing business, Amazon Prime and Marketplace, where the company acts as a middleman for third-party vendors, are also gaining momentum.

Amazon’s Prime loyalty program offers one-hour delivery, original TV programming and access to digital entertainment products such as Prime Music and Prime Video for an annual $99.

All this means that Amazon is valued at $317 billion, making it the third-largest U.S.-listed company by market value, behind Apple and Alphabet, both of which posted disappointing quarterly results.

Amazon shares, which have gained 40 percent in the past year, trade at 98.7 times forward earnings, indicating that investors see huge potential for more growth. Apple trades at 10.8 times earnings, while Alphabet trades at 19.9 times.

 

Amazon claims its women are paid the same as men

AmazonOnline bookseller Amazon claimed that its female employees earned as much as their male counterparts, according to a survey it recently conducted.

The disclosure came as US companies face criticism on the issue of pay equality, especially in the male-dominated technology sector.

The Seattle-based online retailer said it carried out a study after pressure from Arjuna Capital which has been pushing it to prepare a report on gender pay equity.

Arjuna’s Natasha Lamb, director of shareholder engagement said the group was pleased that Amazon is stepping up in response to investor concerns about gender pay equity.

Amazon, which estimates that women made up 39 percent of its global workforce and 24 percent of managers as of July, said a review of compensation including both base pay and stock compensation found that women earned 99.9 cents for every dollar that men earned in the same jobs.

The survey, which was conducted by an external labour economist, covered Amazon workers at various levels of the company’s organisation in the United States.

“There will naturally be slight fluctuations from year to year, but at Amazon we are committed to keeping compensation fair and equitable,” the company said in a statement.

The study, which was recently completed, also found that minorities earned 100.1 cents for every dollar that white employees earn in the same jobs.

Apple hires Google to do its cloud

apple-dalek-2Fruity cargo cult Apple appears to be admitting that all the cash it wasted on a huge data centre was wasted and it has had to hire Google to build its iCloud.

According to CRN Google has landed Apple as a customer for the Google Cloud Platform.  Of course it was forbidden to talk about it, because it would make its client look like an idiot. Apple wants to reduce its reliance on Amazon Web Services and to that end had invested a fortune into huge data centres which are  about the same size as Google’s.

However it looks like it could not get it to go.  Not only is Apple still using Amazon, it has done this new deal with Google. There is a possibly that it also has a deal with Microsoft for some data.

Google executives mentioned to partners that Apple is spending between $400 million and $600 million on Google Cloud Platform, although this couldn’t be independently confirmed.

Amazon said that it was no big deal, although it was amusing that Google broke its non-disclosure agreements to brag about it to partners. Amazon is still refusing to mention that Apple is a customer.

Apple has spent $3.9 billion to build new data centres in Arizona, Ireland and Denmark, the first of which is set to open later this year.   So the question is why it was buying services from Google if it could get these to go?

It might be that Google made it an offer it could not refuse. Last November Google hired  VMware co-founder and former CEO Diane Greene to lead its cloud business. She is said to be aggressively forming partnerships and swinging deals to bring in large enterprise customers.

Where this leaves Apple’s multibillion dollar investment in data gear is anyone’s guess.  It might be waiting for the day that the company really understands the networking technology behind the cloud. Given Apple is still a second class service when it comes to ordinary networking that might be a long time away.

Google sells part of its Robot division

Robby the Robot - Wikimedia CommonsGoogle has placed part of its robotics division, up for sale because it can’t think of any way of making cash from it.

Boston Dynamics, was bought by Goolge in 2013 and has been churning out robots which are often co-developed or funded by the US military.

Possible buyers include Amazon and Toyota’s research and development company the Toyota Research Institute.

So far the outfit has made the Cheetah, which it claims to be the world’s fastest legged robot as well as RiSE, a robot that climbs vertical terrains such as walls, trees and fences.

Amazon uses shedloads of Boston Dynamics robots for its warehouses to cut operating costs and get packages out of the door more quickly.

The TRI also recently hired a team of scientists and engineers to help drive research into artificial intelligence and robots.

Amazon gets into VR

AmazonA job advert indicates that the online bookseller Amazon is getting into VR.

The ad, posted to Amazon’s Glassdoor page, is for a ‘Senior Software Development Manager’ who will be responsible for ‘the Virtual Reality experience within Amazon Video.’

The basic qualifications are a degree in computer science, at least 15 years of relevant experience in engineering, seven years of technical experience and an additional five years of experience as a software development manager. Previous experience with virtual reality is optional apparently.

Netflix recently said it wanted to create 360-degree VR projects, it is likely that Amazon will do the same for its Prime service. Intel just wrote a cheque for a company which also makes this sorts of projects.

However it is possible that the bookseller could also be looking into hardware too. It has filed a patent for a VR headset and releasing its new game engine, Lumberyard, which supports VR technology.

The job posting said: ‘Entertainment is evolving rapidly. The future will not be limited to passive 2D experiences. The Virtual Reality team will explore and create the platform and interface for immersive storytelling. This will include an ingestion and playback platform for Virtual Reality experiences.’

Amazon shares plunge

elepantsOnline bookseller Amazon posted its most profitable quarter but managed to hack off the cocaine nose jobs of Wall Street  by badly missing estimates, sending its shares down more than 13 percent in after hours trading.

Wall Street is worried about the company’s determination to invest more in new areas, extremely low margins and its ability to consistently earn money.

For every dollar the company takes, it makes just 0.75 of a cent in profit which is incredibly low.

Amazon’s net profit for the fourth quarter, which includes the holiday shopping season, rose to $482 million up from $214 million a year earlier.

That figure was held back by rising operating costs.

The company’s shares plunged 13 percent to $551.50 after hours on Thursday, following a nine percent increase in regular trading.

Amazon notched its third consecutive profitable quarter for the first time since 2012, but Wall Street still wants more.

Net sales rose 21.8 percent to $35.75 billion, but missed analysts’ expectations of $35.93 billion.

Excluding a $1.2 billion unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 26 percent compared with the fourth quarter of 2014.

Amazon Chief Financial Officer Brian Olsavsky defended the company’s results saying that foreign exchange rates had an unexpectedly large impact, but overall the company had “a very strong quarter and a strong year.”

Net sales from its cloud services business, Amazon Web Services, rose 69.4 percent to $2.41 billion, compared with a growth of more than 78 percent in the third quarter. AWS continues to be the fastest growing division within Amazon.

The company’s total operating expenses rose more than 20 percent to $34.64 billion in the fourth quarter.

Apple coughs up Italian money

Apple blossom, Mike MageeCupertino  company Apple will  pay the Italian authorities $348 million in back tax.

That’s according to a report from Reuters, which quoted a source close to the matter.

Apple will not only pay $348 million to thee tax office but will be forced to sign a deal which commits it to pay tax from 2015.

While the tax office has confirmed a deal is in the offing, it didn’t say how much Apple would have to pay out.

Apple has a complicated way of accounting that means revenues are booked by an Irish subsidiary.

Other companies, including Amazon and Google, are under investigation for not paying enough taxes in European countries.