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Speaker 1: Welcome, Welcome, Welcome back to the Bob West That's podcast.

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Speaker 1: I guess today Brad Still he works for Bomberg from

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Speaker 1: He is the Amazon it with a definitive book on Amazon,

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Speaker 1: The Everything Store, and he's got a brand new bestseller

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Speaker 1: Amazon Unbound. Brad, glad to have you here, Bob, great

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Speaker 1: to see you, Thanks for having me. Okay, you're talking

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Speaker 1: the book. How you got access? How did you get

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Speaker 1: all this access? Because when you write negative things about

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Speaker 1: the Amazon, well, look, I mean I I don't view

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Speaker 1: myself as a as a critic of the company. I'm

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Speaker 1: almost a historian. I'm trying to tell the story and

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Speaker 1: that's both the accomplishments and the real reasons to scrutinize

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Speaker 1: the company. But um, just to back up, you know,

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Speaker 1: I wrote a previous book about the company, The Everything Store,

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Speaker 1: in two thousand thirteen. It was the origin story. Jeff

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Speaker 1: Bezos didn't particularly like it. You might recall some some

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Speaker 1: negative reviews from his family members and close colleagues. But yes, right, um,

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Speaker 1: but but you know, over the years, it's it has

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Speaker 1: become I think the definitive history of the company. And

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Speaker 1: when I reconsidered, you know, whether there was more story

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Speaker 1: to tell. In two thousand and seventeen, I approached the company.

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Speaker 1: I said that I felt like, you know, the the

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Speaker 1: last decade had been, if anything, more interesting than the

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Speaker 1: than the original, uh you know, fifteen years, and that

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Speaker 1: I wanted to write another installment. And I also think

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Speaker 1: Bob that Amazon change it was. It had been a

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Speaker 1: very secretive, cloistered company up there in Seattle, and to

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Speaker 1: some in some in many respects it's still very secretive.

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Speaker 1: But I think there was an understanding that if they

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Speaker 1: didn't tell their story, if they didn't allow journals to

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Speaker 1: tell their story, then that wasn't going to go very

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Speaker 1: well for them. And so you know, they did allow

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Speaker 1: me to talk to fifteen or so senior executives. Bezos

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Speaker 1: so didn't talk to me. There there are some still

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Speaker 1: some is there perhaps from the first book, but you know,

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Speaker 1: I got I got a lot of access, and then

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Speaker 1: the foundation of the new book. It's really just the

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Speaker 1: volumes of interviews with employees who have come and gone

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Speaker 1: or still they're talking um, you know, on background, sharing

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Speaker 1: what they what they saw, what they think of the

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Speaker 1: company there, and their experiences, the things that they're proud

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Speaker 1: of and the things that they, you know, wish the

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Speaker 1: company did it differently, and that's really the foundation of

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Speaker 1: both books. Now that the book is out, what has

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Speaker 1: the reaction been from inside Seattle, Amazon, HQ, etcetera. Well,

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Speaker 1: there are no one star reviews, so I suppose that's nice.

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Speaker 1: Um there There really has been no official reaction. I

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Speaker 1: will say informally, I've heard from employees and executives of

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Speaker 1: Amazon who who feel like that, you know that the

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Speaker 1: story that I got the story right, that it accurately

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Speaker 1: captures the the innovation that went into products like Alexa,

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Speaker 1: the determination of Bezos, but also the way in which

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Speaker 1: the company has built systems such as the global marketplace

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Speaker 1: and the transportation network, maybe without a lot of regard

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Speaker 1: for what some of the consequences might be. And then

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Speaker 1: if when we can talk about that, but then if

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Speaker 1: they've had to go back and kind of repair some

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Speaker 1: of those and the way in which the company has

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Speaker 1: kind of graduated into a whole new realm of scrutiny

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Speaker 1: and skepticism, and Bezos in particular, I think has come

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Speaker 1: under a lot of that criticism. So you know, I

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Speaker 1: probably not hearing the bad stuff, but for what I

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Speaker 1: have heard from from employees and executives has been favorable.

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Speaker 1: Well usually always here from an employee that got something wrong,

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Speaker 1: whether you did or not, you know that I have gotten.

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Speaker 1: I've gotten a couple of those I should. So what

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Speaker 1: we know is that Bezos will be stepping down and

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Speaker 1: the new person coming in, JOSSI made his bones in

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Speaker 1: a ws To what degree, aid, do you think this

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Speaker 1: will change the company and be to what degree do

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Speaker 1: you project that Bezos will still be involved? So the

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Speaker 1: change every date they've announced is July five, and that

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Speaker 1: is when Jeff Bezos will no longer be CEO and

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Speaker 1: Andy Jesse will be But in in many respects, Bezos

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Speaker 1: has been pulling away from Amazon for many years. And

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Speaker 1: that's part of the story that I'm telling in this book.

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Speaker 1: He buys the Washington Post, he's fighting with the Trump administration,

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Speaker 1: he has his tangle with the National Enquirer, and of

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Speaker 1: course the formation of philanthropies, and he's allowing Andy Jasse

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Speaker 1: and the executives on the retail side to run these

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Speaker 1: massive Amazon businesses with a lot of autonomy and and

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Speaker 1: so that's been a gradual process, and I think it

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Speaker 1: will continue to be a gradual process. Bezos his executive chairman.

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Speaker 1: He says he's going to continue to work on new

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Speaker 1: projects at Amazon. He said in his last investor letter

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Speaker 1: that he's going to be rethinking Amazon's relationship with its

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Speaker 1: blue collar employees and trying to make that a kinder relationship.

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Speaker 1: And so I suspect that not a lot actually changes. Uh.

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Speaker 1: Andy Jasse will certainly be the figurehead he'll be, I think,

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Speaker 1: maybe to the consternation of regulators and lawmakers, when they

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Speaker 1: ask for Jeff Bezos, they will get Andy Jasse, and

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Speaker 1: much the same way Google now gets presents Sundar Pachai

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Speaker 1: and not the founders Larry Pager, Sergey Brand. But I

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Speaker 1: think Bezos will continue to be involved, and I think

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Speaker 1: but I think the process will continue gradually, and in

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Speaker 1: a couple of years we might see him drop the

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Speaker 1: executive part of that title executive chairman, and then really

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Speaker 1: move on to other things. But I don't. I don't

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Speaker 1: think much actually changes at Amazon other than the very

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Speaker 1: public and visible figure of Andy Jasse taking over CEO.

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Speaker 1: To what do you degreed? You believe these changes were

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Speaker 1: engendered by his relationship with his new girlfriend, Lawrence Sanchez.

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Speaker 1: In terms of the his his on a lot of levels,

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Speaker 1: but here talking about stepping down. I don't think so. Again,

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Speaker 1: part of the story in this book is is Bezos

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Speaker 1: stepping away from the big business. This is an Amazon,

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Speaker 1: and that process was under way before the relationship started.

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Speaker 1: So I don't know if it was a precipitating factor

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Speaker 1: in the timing. I will say in the book I

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Speaker 1: revealed that Bezos is building this massive super yacht to

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Speaker 1: sail the high seas on my suspicion because he was

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Speaker 1: never a yacht guy. That that is the the you know,

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Speaker 1: part of the influence of his partner, Um, and so

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Speaker 1: his evolution into a famous figure someone who's turning up

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Speaker 1: at courtside at Wimbledon or partying on the yacht of

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Speaker 1: of Barry Diller, David Geffen, that that is in part

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Speaker 1: the influence of of Laurence Sanchez. He is he has

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Speaker 1: been taking helicopter flying lessons. There's a lot of things

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Speaker 1: I think that Um, maybe she has influenced him, But

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Speaker 1: in terms of the CEO role, I think this was

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Speaker 1: probably all always in the in the long term plans,

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Speaker 1: and Andy Jasse has been in some ways as close

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Speaker 1: to a disciple as you can get. He was basis

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Speaker 1: is t a or shadow basically as chief of staff

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Speaker 1: now twenty years ago, and he has been in the

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Speaker 1: aw s business. But he's also been a member of

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Speaker 1: the S team Andy Jasse, which means he's weighing in

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Speaker 1: on every big decision that has been made at the company,

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Speaker 1: from acquisitions, the acquisition of Whole Foods to the decision

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Speaker 1: on where to put HQ two. So it's not like

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Speaker 1: Jesse has really been a stranger to this bigger part

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Speaker 1: of Amazon, the retail side. He's he has been quite

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Speaker 1: involved in it. Okay, let's just staying with this, Lauren

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Speaker 1: Sanchez changes you know that blew up at Piccaba tabloid issue.

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Speaker 1: You certainly cover that in the book. But the divorce

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Speaker 1: he that Jeff had with Mackenzie was relatively smooth and

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Speaker 1: she's even gotten remarried ding Bezos has not, whereas Gates,

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Speaker 1: the whole situation blew up and is continuing in the news.

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Speaker 1: Do you feel that from the company's perspective, bezos perspective,

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Speaker 1: the business and world perspective, and those could be multiple

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Speaker 1: viewpoints that this is now in the rear view mirror

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Speaker 1: or people still judging him for this, and there might

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Speaker 1: be another few shoes to drop. I think folks have

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Speaker 1: pretty much moved on. And it might have been it's

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Speaker 1: It might be a symbol of his absolute sort of

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Speaker 1: mastery of the levers of public relations in that he

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Speaker 1: he so swiftly put it behind him and vanquished his rivals.

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Speaker 1: If you remember about the editor of the National Inquirer

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Speaker 1: who published that story, um was fired afterwards. You know,

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Speaker 1: Bezos wrapped himself up in the mantle of the Washington Post,

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Speaker 1: used the Saudi enmity toward the Washington Post and towards

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Speaker 1: his ownership of it as as kind of a weapon,

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Speaker 1: and imputed political motives to the Inquirer. And as I

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Speaker 1: show in the book, there really weren't any. The Inquirer

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Speaker 1: was was writing about writing a story that Lawrence Sanchez's

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Speaker 1: brother had had given him and trying to embarrass the

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Speaker 1: wealthiest person in the world. But Bezos really turned the

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Speaker 1: tables on them. He posted that famous Medium article. Uh,

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Speaker 1: he accused them of extortion, and the Southern District of

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Speaker 1: New York investigated it. The FBI investigated it and and

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Speaker 1: moved on. Didn't didn't really find anything. So but are

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Speaker 1: there other shoes to drop? I mean, I wanna approach

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Speaker 1: this topic with a little bit of humility. It is

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Speaker 1: such a crazy topic. The cast of characters you can't

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Speaker 1: even fathom is so bizarre. It's a hall of mirrors.

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Speaker 1: I concluded, based on the information that's in the court filings,

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Speaker 1: based on people that I talked to, the testimony of

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Speaker 1: the reporters and editors at the Inquirer, that it really

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Speaker 1: was Michael Sanchez delivering them the text, messages and some

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Speaker 1: images in the fall of two thousand and eighteen, and

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Speaker 1: that's how they got the story. But if you're asking,

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Speaker 1: could could we find out something unfathomable about the Saudi

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Speaker 1: government's hack of his cell phone, tipping off the paper,

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Speaker 1: or some Trump World connection that we we can't possibly guess,

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Speaker 1: I would say it's improbable, but I want to leave

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Speaker 1: open the possible ality for it, and I hope, hopefully

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Speaker 1: do a little bit in the book, because this story

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Speaker 1: has taken so many twists and turns that you don't know.

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Speaker 1: But I would say if something else emerged, it would

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Speaker 1: probably contradict the information and the timeline that we already

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Speaker 1: have established in the court files, where the editors and

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Speaker 1: reporters of the National Enquirers say, in September two, eighteen,

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Speaker 1: Michael Sanchez approached them with this tip and they knew

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Speaker 1: nothing about it beforehand, and in fact afterwards have to

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Speaker 1: had to kind of read into the tea leaves because

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Speaker 1: he wasn't being explicit. So this idea that perhaps they

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Speaker 1: were tipped off severally about the Saudi government would be surprising,

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Speaker 1: It would It would contradict a lot of the established evidence.

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Speaker 1: Let's go back to Bezos and him splitting from the company.

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Speaker 1: In the book, he's really the driving force for innovation.

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Speaker 1: He is the one who's pushing the envelope with the

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Speaker 1: moon shots. He's actually in space. But I'm using that

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Speaker 1: in a business sense. Do you believe he will continue

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Speaker 1: to play that role? And to what degree is the

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Speaker 1: culture of the company, So if he's not doing it,

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Speaker 1: someone else might. It's a great question. And in the

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Speaker 1: book I am telling the origin stories of products like

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Speaker 1: Alexa and and the Ghost Store, of those cashier less supermarkets,

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Speaker 1: and they all start they typically start with a Bezos idea.

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Speaker 1: And in fact, if the Alexa project starts with an

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Speaker 1: email from Bezos to his deputies, we should build a

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Speaker 1: twenty dollar computer whose brains are in the cloud that's

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Speaker 1: completely controllable by your voice. And I have the first

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Speaker 1: Bezos whiteboard drawing of the product that becomes the the

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Speaker 1: Echo or an Alexa. And so when you peel back

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Speaker 1: the layers to a lot of these projects inside Amazon,

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Speaker 1: not only do you often find a Bezos idea, but

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Speaker 1: you find that it was his sponsorship, his maniacal attention,

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Speaker 1: his willingness to invest uneconomically in the seeds of an

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Speaker 1: idea and then to and then to follow through spending money,

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Speaker 1: losing money, risking failure. That is kind of key to

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Speaker 1: the inventiveness. And am on and I think you put

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Speaker 1: your finger on on something interesting and real. They would say,

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Speaker 1: They would preach that Amazon has a culture of invention,

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Speaker 1: that it's decentralized, that employees can move quickly on their own.

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Speaker 1: It's the land of a thousand CEOs. It's all by design.

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Speaker 1: But I just really wonder if in terms of at

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Speaker 1: least minting new product categories, once Bezos really does step away,

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Speaker 1: and again that might not be for a couple of

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Speaker 1: years he's executive chairman, he'll be involved, but once he

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Speaker 1: really does step away, well, Amazon have the same ability

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Speaker 1: to strike fear and employees to go pursue big things

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Speaker 1: and then obviously competitors when they enter new markets. Well, historically,

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Speaker 1: you know, individuals make a difference. They can't be quantified.

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Speaker 1: You can get a manager who's an NBA, but someone

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Speaker 1: who's an entrepreneur that tends to be a unique character,

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Speaker 1: but staying with the company for a second. For years,

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Speaker 1: their financials were not good. We're going back almost twenties.

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Speaker 1: Does he the worst numbers? To what degree is the

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Speaker 1: company playing to the street at all? Back when when

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Speaker 1: Bezos wrote that first letter to shareholders, he he kind

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Speaker 1: of called his shot. He said, We're not going to

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Speaker 1: really pay attention to short term metrics. We're not going

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Speaker 1: to focus on profitability. We're gonna run the company for

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Speaker 1: market share and cash flow. And that promise and the

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Speaker 1: patient investors that enlisted got them through many, many tough years.

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Speaker 1: And in fact, as I write in the book, even

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Speaker 1: in two thousand fifteen, Amazon was either losing money or

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Speaker 1: not very profitable, and Steve Ballmer went on the Charlie

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Speaker 1: Rose Show and said, it's not a real company, Charlie,

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Speaker 1: You've got to make money. That's my Steve Balmber impression.

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Speaker 1: Bob Um maybe needs some work, and it was because

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Speaker 1: not that Amazon was unprofitable, it was almost hiding its profits.

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Speaker 1: Bezos was taking the winnings from the retail business, the

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Speaker 1: winnings from AWS and funneling them in Alexa and China

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Speaker 1: and India and Prime Video, and that all paid remarkable dividends.

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Speaker 1: And I think recently it's an extraordinarily profitable company. The

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Speaker 1: stock prices zoomed up. It's worth one point six trillion dollars.

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Speaker 1: And no, I don't I don't, but I don't think

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Speaker 1: the operating posture of the company has changed. I don't

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Speaker 1: think they particularly pay attention to two quarterly numbers. I mean,

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Speaker 1: they've got a pretty professional CFO and finance staff that

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Speaker 1: seems to be good at making projections and then exceeding them. Um.

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Speaker 1: But look, Amazon doesn't provide a dividend, it doesn't buy

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Speaker 1: back its own stock. Right, It's not doing the things

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Speaker 1: that would please more short term investors. It's it really is.

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Speaker 1: It continues to take its its profits and build more

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Speaker 1: fulfillment centers and buy more Prime Video. It's buying the

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Speaker 1: mg MGM and the catalog there, build more data centers,

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Speaker 1: and basically Amazon's winnings go to fund more Amazon, so

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Speaker 1: it's unlike a lot of other companies. It's still incredibly

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Speaker 1: optimistic about the future, and clearly it has not achieved

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Speaker 1: whatever maturity or end goal that it has for being ubiquitous.

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Speaker 1: And one thing you go deeply into in the book

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Speaker 1: is the organizational structure. You know, Bezos basically has the

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Speaker 1: guy who shadows him. Sounds like a low position, but

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Speaker 1: it's really a privileged position. Their committees you move up.

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Speaker 1: For those who were uninitiated, can you please describe the structure? Okay, Well,

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Speaker 1: so the technical title is the technical assistant, and Bezos

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Speaker 1: had one. He actually hasn't for a couple of years,

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Speaker 1: which might have been a sign that he was ready

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Speaker 1: for the CEO transition. But the others, the other members

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Speaker 1: of the leadership team, the s team, they all have

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Speaker 1: their t A S and the s TEA. So everybody there,

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Speaker 1: I didn't know everybody there has a t A too.

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Speaker 1: How far down the totem pole does that go or

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Speaker 1: is that it? I? I believe it's just the the

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Speaker 1: the the s VP is the senior vice presidents, and

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Speaker 1: maybe not even all of them. But it's my understanding

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Speaker 1: that the the the upper echelon of the company. They

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Speaker 1: all have tas. So for example, Beth Galletti, the senior

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Speaker 1: vice president of HR, she has a technical assistant, Andy

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Speaker 1: Jasey as the head of a w S, head of

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Speaker 1: t A, and of course we'll have one of CEO.

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Speaker 1: So that's interesting. It's a way in which I think

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Speaker 1: Amazon training. It's almost a leadership and informer leadership training

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Speaker 1: program where chosen executives just get bathed in the you know,

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Speaker 1: the mechanics of the senior leaders and the leadership committee

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Speaker 1: at Amazon. So it's a it's an interesting training program.

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Speaker 1: But you know, think of Amazon, I guess as a

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Speaker 1: little bit of a conglomerate. So many disparate businesses right,

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Speaker 1: so much surface area to this company's it almost makes

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Speaker 1: it hard to categorize. But a senior vice president, you know,

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Speaker 1: tends to kind of oversee one or several of these

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Speaker 1: business units and and they run pretty autonomously. Again the

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Speaker 1: Land of a thousand CEOs, they call them single threaded leaders,

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Speaker 1: a leader of the team. It's like a little CEO

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Speaker 1: of his own group. And they've got a lot of autonomy.

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Speaker 1: But they report, they push up reports, it up through

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Speaker 1: the organization and those have metrics and operating plans, um

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Speaker 1: competitive analysis, and all those reports filter up to the

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Speaker 1: S team. Oh and by the way, Bob, you're probably

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Speaker 1: familiar that all meetings, all deliberations at Amazon start with

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Speaker 1: the six page documents. Right. It's a very right. It's

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Speaker 1: a writing culture and editorial culture, and so the documents

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Speaker 1: flow up and then the senior leadership team obviously they

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Speaker 1: make the big strategic decisions, but they also push goals

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Speaker 1: they're called S team goals down through the organization. So

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Speaker 1: a small team in Amazon Fresh, the grocery delivery service,

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Speaker 1: and this is an example from my book, might get

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Speaker 1: a goal to go and produce a eclectic product there

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Speaker 1: there I have an example in the book called the

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Speaker 1: single cow burger. And in fact, a team gets this

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Speaker 1: directive to go produce a single cow burger, or a

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Speaker 1: burger made from the meat of just one cow instead

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Speaker 1: of a hundred uh, and to do it, you know,

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Speaker 1: by by the next quarterly review. And that's how it works.

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Speaker 1: And there are hundreds of S team goals and they

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Speaker 1: pushed down and then the teams proliferate and and they

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Speaker 1: report their progress upwards. Now we've seen a lot of history, unfortunately,

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Speaker 1: the last couple of decades with these multi furious companies

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Speaker 1: having these goals, and then the people at the bottom

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Speaker 1: or in the middle are so busy getting the goals

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Speaker 1: that they throw their morals right out the window. Wells

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Speaker 1: Fargo being the best case, because rather than you know,

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Speaker 1: say wait a second, this is wrong, it's unachievable, they say,

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Speaker 1: if I want to move up the company, I want

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Speaker 1: to get my bonus. So how does that you know?

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Speaker 1: Is that a factor you think at Amazon? Absolutely? And

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Speaker 1: in fact that the history of the company is replete

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Speaker 1: with low level executives in fear for their jobs, desperately

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Speaker 1: trying to meet their goals, moving fast and getting getting

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Speaker 1: to some trouble um. There's a great example in the

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Speaker 1: book with the marketplace segment in the in the well,

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Speaker 1: actually it's it's in the consumable segments, so the fresh

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Speaker 1: groceries and other other products that you might find at

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Speaker 1: a drug store or supermarket. And and they're running the

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Speaker 1: private label division, so it's it's their job to go

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Speaker 1: create Amazon Basics batteries or Amazon Essential diapers or Solomo

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Speaker 1: potato chips, and essentially they start peaking at the data

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Speaker 1: from the third party sellers to see independent sellers on Amazon,

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Speaker 1: what's doing well for them? Maybe Amazon should copy it.

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Speaker 1: And of course that is now put Amazon at the

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Speaker 1: center of all sorts of questioning in front of the

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Speaker 1: US Congress and the and the EU and and it's

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Speaker 1: arguably violated some antitrust laws. Well we'll see it. Amazon

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Speaker 1: has said, well, there's a policy against that. The people

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Speaker 1: shouldn't have been managers, shouldn't have been doing it. But

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Speaker 1: I think to your point, it's a decentralized culture with

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Speaker 1: big goals and a culture of fear. And you know

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Speaker 1: when when when you create that environment, bad things can happen.

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Speaker 1: For those who have worked for Amazon, I'm not talking

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Speaker 1: about those in the warehouse, but those working in white

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Speaker 1: collar positions, they portray a terrible culture where they're working

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Speaker 1: around the clock. There's fear, there's expendable it's the opposite

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Speaker 1: of some of these other companies that you know, put

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Speaker 1: them in a blanket and make them feel warm. Is

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Speaker 1: that your experience? One point two million people work for Amazon.

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Speaker 1: There there. I think it's just honest to say that

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Speaker 1: there is a wide variety of of experience, and there

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Speaker 1: are people that will sing the harmony of Amazon, and

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Speaker 1: you know, drink the kool aid and loved it there

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Speaker 1: or there for years, and and then their fair number

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Speaker 1: of dissidents, and you hear different things, you know, the

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Speaker 1: executive environment in the white collar offices, and then the warehouses.

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Speaker 1: You want to talk about the warehouses predominantly not yet,

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Speaker 1: let's just stay with white collar. We'll go back to

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Speaker 1: the house. Well, look, I mean there are there. There

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Speaker 1: are many people that have left there with a lot

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Speaker 1: of pride. And then there are people and I profile

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Speaker 1: a couple of them in the book who felt like

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Speaker 1: it was a cruel culture, that they gave more than

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Speaker 1: they got, that they didn't particularly end up admiring bezos

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Speaker 1: or the or the leadership team there. I I profiled

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Speaker 1: the woman in this book who who ran the first

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Speaker 1: Prime Day in two thousand fifteen, and she came to

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Speaker 1: sort of think that, like here she was sort of

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Speaker 1: engaged in selling people, you know, insta pots and other

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Speaker 1: appliances that perhaps they didn't need, in a kind of

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Speaker 1: frenzy of discounting. And the other thing that she really

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Speaker 1: took away from the experience was she had gone to

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Speaker 1: herculean lynx to get this thing out the door in

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Speaker 1: two thousand fifteen, the first Prime Day, and you know, afterwards,

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Speaker 1: they presented one of these six page documents that kind

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Speaker 1: of highlighted everything they did wrong. And so it wasn't

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Speaker 1: a culture of celebrating success. It was this this just

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Speaker 1: really driven culture of how do we get better, how

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Speaker 1: do we fix the errors that we may And she

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Speaker 1: found that thankless, and she she found the culture somewhat difficult.

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Speaker 1: And the big epiphany for her was when she went home,

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Speaker 1: I think it was a couple of years after the

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Speaker 1: first Prime Day. She had taken on a number of

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Speaker 1: different roles, and she said that she found herself using

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Speaker 1: Amazon's leadership principles on her mother. They're like the crew

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Speaker 1: of the sort of you know, arduous ways that they

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Speaker 1: talked to each other and get to decisions. And that's

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Speaker 1: when she realized that the culture had changed her a

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Speaker 1: little bit in the way she didn't like. So, you know,

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Speaker 1: all that said, Amazon remains high on the list of

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Speaker 1: of admired employees or places that you know, when LinkedIn

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Speaker 1: does a survey of places people want to work or

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Speaker 1: enjoy working, Amazon, perhaps the Jeff Bezos consternation now appears

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Speaker 1: high on those lists. He never wanted to create a

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Speaker 1: country club. He told human resource employees that it should

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Speaker 1: be challenging, it should be difficult. He wants people to

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Speaker 1: do their best work and then move on. I think

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Speaker 1: that's accounts for some of the challenges, the cruelty and

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Speaker 1: Amazon culture. It's also been effective and it attracts a

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Speaker 1: certain kind of person. So I think it's a little

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Speaker 1: bit of a it's it's hard to characterize easily or simplistically.

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Speaker 1: I think it's it's it's complex and it's tough, and

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Speaker 1: that's by design, and that attracts some people, and then

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Speaker 1: after a couple of years or even after the first visit,

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Speaker 1: it repels them. Okay, how many people are on the

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Speaker 1: S team? You're you're challenging you now because they keep

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Speaker 1: adding to it. But I want to say it's about

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Speaker 1: twenty four people right now, and it's as big as

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Speaker 1: as it's ever been. And that's in part because Amazon

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Speaker 1: has continued to expand and they've got members there who

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Speaker 1: represent Amazon fashion and technical engineers on on the on

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Speaker 1: aws who are members of of the S team. Um,

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Speaker 1: there's a Mike Hopkins at Prime Videos on the S

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Speaker 1: team now. But in part it's also because This was

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Speaker 1: a lily white and male crew for a very long time,

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Speaker 1: and quite rightfully, I think the employees at Amazon and

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Speaker 1: some of the shareholders and some of the outside observers,

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Speaker 1: you know, made the point that Amazon needs to modernize,

428
00:24:09,560 --> 00:24:12,320
Speaker 1: and as with many things, Bezos kind of got the message,

429
00:24:12,320 --> 00:24:14,199
Speaker 1: but got it a little late, and he started to,

430
00:24:14,440 --> 00:24:18,440
Speaker 1: you know, really add to the diversity of that leadership team. Now,

431
00:24:18,480 --> 00:24:22,479
Speaker 1: let's talk about the documents. Six pages. That's not sure. Okay,

432
00:24:22,560 --> 00:24:24,840
Speaker 1: someone wrote a lot of papers in college and as

433
00:24:24,880 --> 00:24:27,960
Speaker 1: a writer. Now, to what degree are these Let's say

434
00:24:27,960 --> 00:24:29,919
Speaker 1: I had to do one. To what degree do I

435
00:24:29,960 --> 00:24:32,840
Speaker 1: have to write something on an a level both in

436
00:24:32,960 --> 00:24:36,399
Speaker 1: content and style? And you know what's the require? How

437
00:24:36,440 --> 00:24:38,040
Speaker 1: much time to people put into this? And if you

438
00:24:38,160 --> 00:24:40,760
Speaker 1: have a public company, it's not a direct analogy. You know,

439
00:24:40,760 --> 00:24:44,919
Speaker 1: they're they're managing the street. It's a huge job. In

440
00:24:44,960 --> 00:24:49,960
Speaker 1: addition to doing the regular job, is producing these six

441
00:24:50,080 --> 00:24:54,320
Speaker 1: page reports. Similar you've put your finger on why I

442
00:24:54,359 --> 00:24:57,200
Speaker 1: think the culture can be so enervating too too many people.

443
00:24:58,000 --> 00:25:00,720
Speaker 1: The documents take a lot of time. That's often work

444
00:25:00,840 --> 00:25:03,480
Speaker 1: that moves into the night or the weekends. They're also

445
00:25:03,560 --> 00:25:08,359
Speaker 1: really collaborative it's a collaborative process. It's not like an

446
00:25:08,359 --> 00:25:11,840
Speaker 1: employee writes one and then they go and are reviewed

447
00:25:11,960 --> 00:25:15,800
Speaker 1: in a leadership meeting. These are deliberated over there, edited,

448
00:25:15,840 --> 00:25:19,760
Speaker 1: they're revised ad nauseam. I described that the process of

449
00:25:19,840 --> 00:25:23,560
Speaker 1: revisions during Alexa, with even Bezos weighing in and a

450
00:25:23,640 --> 00:25:26,520
Speaker 1: kind of perpetual tug of war in these documents about

451
00:25:26,520 --> 00:25:29,960
Speaker 1: what Alexa would do. So in a way, it's not

452
00:25:30,000 --> 00:25:32,840
Speaker 1: just an end product that's presented at a meeting, but

453
00:25:32,920 --> 00:25:36,360
Speaker 1: it's very much part of the deliberative process. Right figuring

454
00:25:36,359 --> 00:25:38,439
Speaker 1: out what a new product or service is going to

455
00:25:38,520 --> 00:25:41,639
Speaker 1: do is in part they hash it out over the

456
00:25:41,640 --> 00:25:44,560
Speaker 1: writing of these documents, and these are edited and revised

457
00:25:44,600 --> 00:25:48,760
Speaker 1: and aggregated throughout the organization as they pass up, particularly

458
00:25:48,840 --> 00:25:53,480
Speaker 1: during the the operating reviews, the bi annual review sessions

459
00:25:53,480 --> 00:25:56,639
Speaker 1: OP one and OP two during the year, and probably

460
00:25:56,680 --> 00:25:59,400
Speaker 1: by the time something is presented to the senior leadership team,

461
00:26:00,040 --> 00:26:03,879
Speaker 1: it's destroyed at least you know, one team's private life

462
00:26:03,920 --> 00:26:06,960
Speaker 1: for the period of many weeks and been revised a

463
00:26:06,960 --> 00:26:10,240
Speaker 1: million times. So it's it's core to how Amazon works.

464
00:26:10,240 --> 00:26:13,080
Speaker 1: It's peculiar. I know a lot of executives who have

465
00:26:13,160 --> 00:26:15,680
Speaker 1: left and tried to bring it to other companies with

466
00:26:15,760 --> 00:26:19,119
Speaker 1: mixed success. And I don't know. I think it's the

467
00:26:19,119 --> 00:26:21,840
Speaker 1: way that Bezos has kind of trained himself and his

468
00:26:21,920 --> 00:26:24,680
Speaker 1: leadership team to process information, but I'm not so sure.

469
00:26:24,720 --> 00:26:27,400
Speaker 1: It's kind of how naturally the rest of us might

470
00:26:27,560 --> 00:26:30,240
Speaker 1: might do it. Now. You also portray in the book

471
00:26:30,320 --> 00:26:34,400
Speaker 1: that Bezos has a jobs and personality to a degree

472
00:26:35,080 --> 00:26:38,399
Speaker 1: that he will make a snap judgment, say negative things,

473
00:26:38,520 --> 00:26:42,159
Speaker 1: not worry about the reaction. On a personal level, that

474
00:26:42,320 --> 00:26:46,480
Speaker 1: he's evolved a little bit. What's going on there? So

475
00:26:46,520 --> 00:26:49,800
Speaker 1: in the Everything Store, I think, I think, I really write,

476
00:26:49,920 --> 00:26:52,760
Speaker 1: I think I'm capturing Bezos one point oh a little bit.

477
00:26:52,920 --> 00:26:54,919
Speaker 1: And and that is in large part the person you

478
00:26:55,000 --> 00:26:58,840
Speaker 1: describe just withering feedback to employees. Did I take my

479
00:26:58,920 --> 00:27:04,080
Speaker 1: stupid pills today? A or um? Is this the A team?

480
00:27:04,080 --> 00:27:07,159
Speaker 1: Where did the A team go? Just? You know, he

481
00:27:07,240 --> 00:27:09,960
Speaker 1: had a he had a way, particularly when he got impatient,

482
00:27:10,800 --> 00:27:13,720
Speaker 1: And I flashed back to that in Amazon and Bound.

483
00:27:13,720 --> 00:27:16,640
Speaker 1: I have an episode that I believe happens around two

484
00:27:16,520 --> 00:27:19,679
Speaker 1: thou seven where he's reviewing a document that has a

485
00:27:19,720 --> 00:27:23,639
Speaker 1: mathematical error in it and he he he identifies the

486
00:27:23,680 --> 00:27:26,320
Speaker 1: air and he says, if I can't trust this number,

487
00:27:26,359 --> 00:27:28,480
Speaker 1: I don't know why I can trust anything in this document.

488
00:27:28,720 --> 00:27:31,080
Speaker 1: And he rips it in half and throws it down

489
00:27:31,080 --> 00:27:34,280
Speaker 1: the conference from table and walks out. So there's Bezos

490
00:27:34,320 --> 00:27:39,240
Speaker 1: one oh. My sense is that either he got leadership

491
00:27:39,600 --> 00:27:43,919
Speaker 1: assistance or else just realized that he really couldn't do

492
00:27:43,960 --> 00:27:47,840
Speaker 1: that anymore, that with his stature inside the company, with

493
00:27:47,920 --> 00:27:52,440
Speaker 1: his public profile, perhaps with modernizing norms around around management,

494
00:27:52,480 --> 00:27:54,960
Speaker 1: that that wasn't really going to be tolerated. And I

495
00:27:55,000 --> 00:27:59,520
Speaker 1: think Bezos two point oh was equal measures inspiring and intimidating.

496
00:28:00,040 --> 00:28:02,880
Speaker 1: Certainly the end result of motivating employees was the same.

497
00:28:03,280 --> 00:28:05,680
Speaker 1: He still have a couple episodes in the book will

498
00:28:05,680 --> 00:28:09,000
Speaker 1: walk out of a meeting when he's not satisfied. But

499
00:28:09,080 --> 00:28:11,680
Speaker 1: Beazos two point oh I think was a little more

500
00:28:11,720 --> 00:28:15,239
Speaker 1: circumspect with some of his negative negativity. Now that's not

501
00:28:15,280 --> 00:28:17,800
Speaker 1: to say at Blue Origin and Space Company, which is

502
00:28:17,920 --> 00:28:22,080
Speaker 1: has lagged SpaceX Elon Musk's company quite a bit, he

503
00:28:22,160 --> 00:28:25,399
Speaker 1: doesn't show flashes of that. But my sense from talking

504
00:28:25,400 --> 00:28:28,919
Speaker 1: to innumerable people was that he he doesn't really unleash it,

505
00:28:29,320 --> 00:28:33,200
Speaker 1: and the way perhaps you know you're associating with Steve Jobs. Okay,

506
00:28:33,520 --> 00:28:35,760
Speaker 1: you described the first thing they do in these s

507
00:28:36,280 --> 00:28:40,320
Speaker 1: meetings is they read the document. Reading when other people

508
00:28:40,320 --> 00:28:43,760
Speaker 1: there makes one very self conscious. Do they literally read

509
00:28:43,800 --> 00:28:45,760
Speaker 1: it from beginning to end or is it just there

510
00:28:45,760 --> 00:28:48,040
Speaker 1: in the reference and how much time does it take

511
00:28:48,360 --> 00:28:51,240
Speaker 1: or was allotted for everybody to read it? They sit

512
00:28:51,320 --> 00:28:54,920
Speaker 1: there in meditational silence, reading it until everybody has done,

513
00:28:55,640 --> 00:28:58,040
Speaker 1: then they go, or if it's a steam meeting, they'll

514
00:28:58,040 --> 00:29:01,560
Speaker 1: go around the room and Bezos and I presume Andy

515
00:29:01,680 --> 00:29:07,000
Speaker 1: Jessey soon speaks last, and the discussion ensues. But they

516
00:29:07,040 --> 00:29:09,680
Speaker 1: read it. They read the thing, which is right, incredible

517
00:29:09,760 --> 00:29:11,720
Speaker 1: six pages long. It seems like it could take a while,

518
00:29:11,880 --> 00:29:15,120
Speaker 1: but oftentimes that's what they do. And by the way,

519
00:29:15,480 --> 00:29:18,240
Speaker 1: Bezos brought that to the Washington Post, and when the

520
00:29:18,240 --> 00:29:22,080
Speaker 1: senior leadership team there convence with Bezos, they'll present him

521
00:29:22,080 --> 00:29:24,680
Speaker 1: with a document. Now, my impression was with the Post

522
00:29:24,760 --> 00:29:28,360
Speaker 1: meetings that he was reading those beforehand, which maybe made

523
00:29:28,400 --> 00:29:31,960
Speaker 1: their time a little bit more efficient, but that is

524
00:29:32,000 --> 00:29:34,520
Speaker 1: not always the case, and an Amazon certainly they sit

525
00:29:34,560 --> 00:29:38,760
Speaker 1: there in silence reading. Okay, let's go to the warehouses.

526
00:29:38,880 --> 00:29:42,320
Speaker 1: Let's first, talk about practical You know, I'm at a distance,

527
00:29:42,360 --> 00:29:44,320
Speaker 1: you're right there in the belly of the beast. It

528
00:29:44,440 --> 00:29:49,440
Speaker 1: seems to me that certain warehouses were created and certain

529
00:29:49,480 --> 00:29:54,920
Speaker 1: machinery was installed, which were then abandoned repurposed. Do I

530
00:29:55,040 --> 00:29:58,480
Speaker 1: have that right in terms of do you mean the

531
00:29:58,600 --> 00:30:07,720
Speaker 1: and the actual physical machinery the culture they know them physical? Well, no,

532
00:30:07,920 --> 00:30:11,959
Speaker 1: I think that, um, I mean the the Amazon warehouses

533
00:30:12,000 --> 00:30:15,000
Speaker 1: have evolved quite a bit. They've become somewhat automated over

534
00:30:15,040 --> 00:30:18,120
Speaker 1: the years. Amazon bought of robotics system called Kiva back

535
00:30:18,160 --> 00:30:20,520
Speaker 1: in two thousand and twelve. Those have been rolled out.

536
00:30:20,880 --> 00:30:23,880
Speaker 1: But when I in the in the time spend where

537
00:30:23,880 --> 00:30:27,800
Speaker 1: I start this book two twelve, Amazon still only has

538
00:30:27,880 --> 00:30:31,000
Speaker 1: a couple of dozen fulfillment centers around the country. Now

539
00:30:31,040 --> 00:30:35,560
Speaker 1: it has north of eight hundred fulfillment centers, sortation centers,

540
00:30:35,600 --> 00:30:40,680
Speaker 1: transportation hubs. This company and the operations network has sprawled

541
00:30:40,680 --> 00:30:43,520
Speaker 1: out in every direction. So you know, part of the

542
00:30:43,560 --> 00:30:46,440
Speaker 1: reason that Amazon's tax burden is so low, by the way,

543
00:30:46,760 --> 00:30:50,040
Speaker 1: is because they're buying all this new equipment and then

544
00:30:50,040 --> 00:30:53,040
Speaker 1: it's depreciating and Amazon's writing that off on their taxes.

545
00:30:53,120 --> 00:30:56,360
Speaker 1: So it is um you know, it's it's a unique

546
00:30:56,440 --> 00:30:59,280
Speaker 1: fulfillment network. They keep adding to it and changing it,

547
00:30:59,320 --> 00:31:01,800
Speaker 1: tweaking it. Bringing in the robotics is one of the

548
00:31:02,120 --> 00:31:06,000
Speaker 1: latest changes. Spawning a transportation network so that it's not

549
00:31:06,200 --> 00:31:10,800
Speaker 1: ups or the post office delivering packages, but it's Amazon

550
00:31:10,960 --> 00:31:14,240
Speaker 1: vans and Amazon trucks on the highway. That's another change.

551
00:31:14,280 --> 00:31:16,680
Speaker 1: So it's it's it's pretty fresh, and I think it's

552
00:31:16,680 --> 00:31:19,240
Speaker 1: also pretty unique. And I think one of the major

553
00:31:19,320 --> 00:31:21,680
Speaker 1: vectors of growth for Amazon is going to be, you know,

554
00:31:21,760 --> 00:31:24,280
Speaker 1: not only delivering more of their packages, but one day

555
00:31:24,320 --> 00:31:27,200
Speaker 1: maybe offering that as a service to other companies. Let

556
00:31:27,240 --> 00:31:36,400
Speaker 1: Amazon be your FedEx and deliver a package. Okay, Now

557
00:31:36,440 --> 00:31:39,360
Speaker 1: we had a move that one best picture. How many

558
00:31:39,360 --> 00:31:42,000
Speaker 1: people saw it as another debatable issue, but I saw

559
00:31:42,120 --> 00:31:45,160
Speaker 1: it. It It was an excellent picture depicting the life of

560
00:31:45,200 --> 00:31:49,400
Speaker 1: an warehouse person an Amazon. So that what you say

561
00:31:49,440 --> 00:31:51,600
Speaker 1: in the book is a lot of that has been automated,

562
00:31:51,640 --> 00:31:54,360
Speaker 1: so the people are not running around, but they're getting

563
00:31:54,400 --> 00:31:58,720
Speaker 1: repetitive use injuries. You also said there was a policy

564
00:31:59,200 --> 00:32:03,080
Speaker 1: where kind of like g the least performing people are

565
00:32:03,480 --> 00:32:07,800
Speaker 1: are cut off. Then there's issues of compensation. What is

566
00:32:07,840 --> 00:32:11,000
Speaker 1: the status of work in the warehouses today, well, the

567
00:32:11,680 --> 00:32:15,520
Speaker 1: the status of work is um and it's still a

568
00:32:15,520 --> 00:32:19,720
Speaker 1: a a position that is is sought after in many

569
00:32:20,080 --> 00:32:21,920
Speaker 1: parts of the world. Amazon is one of the fastest

570
00:32:21,920 --> 00:32:24,880
Speaker 1: growing employers. It's now the second largest employer in in

571
00:32:24,920 --> 00:32:29,040
Speaker 1: the U S after Walmart. It's the wage Amazon has

572
00:32:29,160 --> 00:32:33,040
Speaker 1: has raised it in part because of criticism. It's it's

573
00:32:33,080 --> 00:32:36,120
Speaker 1: fifteen dollars an hour in most places, seventeen dollars an

574
00:32:36,120 --> 00:32:41,000
Speaker 1: hour in some, and so comparatively against other kinds of

575
00:32:41,040 --> 00:32:45,120
Speaker 1: warehouse work. You know, Amazon is seen as an employer

576
00:32:45,160 --> 00:32:47,160
Speaker 1: of choice, and I think we saw that a little

577
00:32:47,160 --> 00:32:50,480
Speaker 1: bit in Best Summer, Alabama, where employees voted against a union.

578
00:32:50,520 --> 00:32:53,920
Speaker 1: Now we'll see if the National Labor Relations Board overturns

579
00:32:53,960 --> 00:32:57,840
Speaker 1: that because some Amazon's conduct, but the workers voted pretty

580
00:32:57,880 --> 00:33:00,000
Speaker 1: definitively not to join in the union. We could get

581
00:33:00,040 --> 00:33:03,960
Speaker 1: back to what that means. But you know, all all

582
00:33:04,000 --> 00:33:07,800
Speaker 1: that said, I think that the depiction in Nomad Land

583
00:33:07,840 --> 00:33:09,640
Speaker 1: I thought was accurate. It was it was kind of

584
00:33:09,680 --> 00:33:12,280
Speaker 1: criticized for being too nice to Amazon, but there was

585
00:33:12,320 --> 00:33:14,680
Speaker 1: something about it that resonated with me that you know,

586
00:33:14,720 --> 00:33:18,200
Speaker 1: this was seasonal work, there was no job security, it

587
00:33:18,240 --> 00:33:21,560
Speaker 1: was very transactional. You know, the character was coming in

588
00:33:21,600 --> 00:33:24,840
Speaker 1: there over the holidays. There was a sense of camaraderie

589
00:33:25,320 --> 00:33:28,680
Speaker 1: but also a real sense of melancholy and isolation in

590
00:33:28,680 --> 00:33:31,880
Speaker 1: that work. Um and and look, I mean they didn't

591
00:33:31,920 --> 00:33:35,840
Speaker 1: have a villainous you know, manager firing the Francis mcdormant character,

592
00:33:36,080 --> 00:33:37,720
Speaker 1: but there was something about it I thought that was

593
00:33:37,800 --> 00:33:40,400
Speaker 1: quite sad when particularly when you combined it with the

594
00:33:40,400 --> 00:33:42,680
Speaker 1: rest of your life. So I think that to me

595
00:33:43,280 --> 00:33:47,640
Speaker 1: sort of captures it. You know, these vast facilities that

596
00:33:48,000 --> 00:33:51,240
Speaker 1: have employees, but you know, the work is drowned out

597
00:33:51,280 --> 00:33:55,160
Speaker 1: by a chorus of conveyor belts and automation. Uh. The

598
00:33:55,280 --> 00:34:00,360
Speaker 1: workers are really managed in large part by algorithm them

599
00:34:00,400 --> 00:34:05,040
Speaker 1: that's monitoring everything they do, that's putting them on performance

600
00:34:05,080 --> 00:34:08,799
Speaker 1: improvement plans that if if their work suffers, you know,

601
00:34:08,840 --> 00:34:11,719
Speaker 1: managers that will pipe up if they're taking overly long

602
00:34:11,760 --> 00:34:14,960
Speaker 1: bathroom breaks and and so look, I mean I think

603
00:34:14,960 --> 00:34:17,800
Speaker 1: it's it's it's difficult work, I don't you know. I

604
00:34:18,080 --> 00:34:21,640
Speaker 1: think it's it's highly valued by people who's whose economic

605
00:34:21,760 --> 00:34:26,440
Speaker 1: opportunities are otherwise limited, and it's probably you know, remarkable.

606
00:34:26,680 --> 00:34:28,560
Speaker 1: You know, it's probably good for them that there there

607
00:34:28,680 --> 00:34:31,080
Speaker 1: is opportunity in parts of the country where the manufacturing

608
00:34:31,120 --> 00:34:33,760
Speaker 1: base really has declined. But I do think the Besos

609
00:34:33,840 --> 00:34:36,960
Speaker 1: recently has understood that the you know, the company is

610
00:34:36,960 --> 00:34:40,360
Speaker 1: getting bad image because of some of the testimonies about

611
00:34:40,400 --> 00:34:42,239
Speaker 1: this work and the quality of the work. And that's

612
00:34:42,239 --> 00:34:46,520
Speaker 1: why he has talked about addressing personally the ergonomic issues

613
00:34:46,520 --> 00:34:49,480
Speaker 1: are on standing in one place and servicing the robots

614
00:34:49,560 --> 00:34:51,840
Speaker 1: and and the other other things that people talk about.

615
00:34:52,120 --> 00:34:55,400
Speaker 1: Hopefully we will see Amazon being more mindful about things

616
00:34:55,400 --> 00:35:01,000
Speaker 1: like breaks and mandatory over time. Um. Yeah, and and

617
00:35:01,040 --> 00:35:03,319
Speaker 1: so like I think, I think the company realizes that

618
00:35:03,360 --> 00:35:05,399
Speaker 1: there's a lot of room for improvement and that it's

619
00:35:05,440 --> 00:35:08,359
Speaker 1: public image and large part might depend on whether they

620
00:35:08,360 --> 00:35:10,759
Speaker 1: can really get on top of that issue. So you

621
00:35:10,920 --> 00:35:15,360
Speaker 1: mentioned Bessemer Alabama, and you talked about the unionization effort

622
00:35:15,360 --> 00:35:18,760
Speaker 1: and how it failed. But being such a large company,

623
00:35:18,800 --> 00:35:22,040
Speaker 1: a lot of the questions permeating America. You wonder to

624
00:35:22,120 --> 00:35:24,839
Speaker 1: what degree they'll be focused on Amazon. There will be

625
00:35:24,920 --> 00:35:29,560
Speaker 1: changed their last mild delivery trucks, that's all contractors. This

626
00:35:29,680 --> 00:35:33,680
Speaker 1: has been a big issue in terms of uber and lift.

627
00:35:34,200 --> 00:35:36,400
Speaker 1: So to what degree do you think there's going to

628
00:35:36,440 --> 00:35:39,359
Speaker 1: be changed which will represent change in America or will

629
00:35:39,400 --> 00:35:42,759
Speaker 1: continue to hit in this direction. I think that the

630
00:35:42,800 --> 00:35:46,920
Speaker 1: Biden administration is recognizing the tech companies have gotten away

631
00:35:46,920 --> 00:35:49,759
Speaker 1: with something here being able to to use to use

632
00:35:49,800 --> 00:35:52,919
Speaker 1: one of the technical terms invoked now Fisher their their

633
00:35:52,920 --> 00:35:59,080
Speaker 1: workplaces to employ, you know, to have an employment contract

634
00:35:59,160 --> 00:36:01,320
Speaker 1: with their white collar are workers with some of their

635
00:36:01,400 --> 00:36:06,200
Speaker 1: their fulfillment center workers, but then to basically um outsource

636
00:36:06,320 --> 00:36:09,760
Speaker 1: some of the some of the you know, the harder things,

637
00:36:09,760 --> 00:36:12,520
Speaker 1: the things that the company doesn't want liability over, you know,

638
00:36:12,640 --> 00:36:16,160
Speaker 1: Uber with drivers certainly, you know, Apple does it with janitors,

639
00:36:16,520 --> 00:36:19,759
Speaker 1: cafeteria workers. And Amazon has done it, has created a

640
00:36:19,760 --> 00:36:24,600
Speaker 1: fishered workplace with its drivers. Those are those are contractors

641
00:36:24,640 --> 00:36:28,600
Speaker 1: that are employed by delivery service providers. When they get

642
00:36:28,600 --> 00:36:32,399
Speaker 1: into accidents, Amazon kind of throws its hands up. At

643
00:36:32,400 --> 00:36:35,920
Speaker 1: the same time, they are driving in vans that have

644
00:36:36,080 --> 00:36:41,720
Speaker 1: the Amazon Prime Swish arrow on them, they have Amazon uniforms,

645
00:36:41,800 --> 00:36:45,160
Speaker 1: and in in some cases they're cameras in their automobiles

646
00:36:45,880 --> 00:36:50,600
Speaker 1: run and put there by Amazon, run by Amazon algorithms

647
00:36:50,600 --> 00:36:53,200
Speaker 1: that are monitoring their performance and their safety records. So

648
00:36:53,400 --> 00:36:56,759
Speaker 1: Amazon wants all the elements of control over this workforce

649
00:36:57,000 --> 00:37:00,239
Speaker 1: and really none of the liabilities and the responsibilities or

650
00:37:00,280 --> 00:37:04,399
Speaker 1: for maintaining them. There's a professor at Brandeis University named

651
00:37:04,480 --> 00:37:06,440
Speaker 1: David Wild who wrote a book called The Fisher at

652
00:37:06,480 --> 00:37:09,319
Speaker 1: Workplace and who has really done a lot of of

653
00:37:09,360 --> 00:37:14,080
Speaker 1: work in this area. And I believe he either was

654
00:37:14,120 --> 00:37:17,080
Speaker 1: nominated or currently is a member of the Biden administration,

655
00:37:17,120 --> 00:37:19,839
Speaker 1: or at least was being considered for a role. And

656
00:37:20,040 --> 00:37:22,800
Speaker 1: I think the clear message here is that the Biden

657
00:37:22,840 --> 00:37:25,880
Speaker 1: administration wants to take a look at this and reevaluate

658
00:37:25,920 --> 00:37:28,960
Speaker 1: whether these companies should have more responsibility. And certainly some

659
00:37:29,040 --> 00:37:31,600
Speaker 1: of the legal rulings are on Uber that we've seen

660
00:37:31,600 --> 00:37:34,759
Speaker 1: in the US and in the United Kingdom suggests that

661
00:37:34,880 --> 00:37:39,399
Speaker 1: judges are beginning to view that relationship a little more skeptically. Now,

662
00:37:39,440 --> 00:37:41,799
Speaker 1: one of the discussions in your book is about the

663
00:37:41,880 --> 00:37:47,000
Speaker 1: last mile problem and faster delivery. People pay approximately twenty

664
00:37:47,080 --> 00:37:50,080
Speaker 1: dollars for Prime to get two day delivery. Now it's

665
00:37:50,120 --> 00:37:52,839
Speaker 1: all about one day delivery and then something you can

666
00:37:52,880 --> 00:37:56,000
Speaker 1: get now it's all this convenient. Do you believe this

667
00:37:56,239 --> 00:37:59,719
Speaker 1: actually drive sales? And what is Amazon believe to what

668
00:37:59,800 --> 00:38:03,680
Speaker 1: did user of focus on this issue, I think historically

669
00:38:03,760 --> 00:38:08,160
Speaker 1: fast delivery has always has always shown up in the

670
00:38:08,239 --> 00:38:11,399
Speaker 1: numbers and been meaningful for Amazon's customers, but I will

671
00:38:11,440 --> 00:38:14,359
Speaker 1: I will argue that maybe it's less so now. So

672
00:38:14,680 --> 00:38:18,440
Speaker 1: in the early days when Amazon devised Prime in two

673
00:38:18,480 --> 00:38:22,520
Speaker 1: thousand five, guaranteeing two day shipping, allow people to pay

674
00:38:22,560 --> 00:38:24,520
Speaker 1: once for it and then and then feel like they

675
00:38:24,560 --> 00:38:27,640
Speaker 1: would get things promptly, really made a big difference, and

676
00:38:27,760 --> 00:38:31,080
Speaker 1: Prime locked people in, made them big Amazon spenders, and

677
00:38:31,160 --> 00:38:34,240
Speaker 1: really contributed to some of the amazing growth we've seen

678
00:38:34,280 --> 00:38:38,080
Speaker 1: since then. But as I mentioned, Amazon has gone from

679
00:38:38,120 --> 00:38:41,240
Speaker 1: a dozen or so fulfillment centers two hundreds and hundreds,

680
00:38:41,239 --> 00:38:43,800
Speaker 1: and there's one not far from where I'm sitting, and

681
00:38:43,840 --> 00:38:46,760
Speaker 1: there's probably not one not far bob from where you're sitting.

682
00:38:47,040 --> 00:38:50,279
Speaker 1: And what that means is that to day or one

683
00:38:50,360 --> 00:38:53,440
Speaker 1: day delivery promise it's it really doesn't mean that much anymore.

684
00:38:53,560 --> 00:38:56,680
Speaker 1: You might be getting your packages from Amazon pretty quickly,

685
00:38:56,840 --> 00:39:01,200
Speaker 1: regardless of whether you're a Prime member. So I suspect

686
00:39:01,239 --> 00:39:03,439
Speaker 1: that's one of the reasons why they're pivoting so hard

687
00:39:03,480 --> 00:39:07,560
Speaker 1: now to content and not just buying MGM, but spending

688
00:39:07,560 --> 00:39:11,120
Speaker 1: eleven billion dollars in two thousand twenty to either license

689
00:39:11,239 --> 00:39:16,319
Speaker 1: or create video. Basically, Prime was a shipping club, and

690
00:39:16,360 --> 00:39:19,440
Speaker 1: now it's becoming a kind of all access content club.

691
00:39:19,920 --> 00:39:22,880
Speaker 1: And so yes, shipping, to answer your question, was important.

692
00:39:22,920 --> 00:39:25,160
Speaker 1: But I think it's it's almost something that people are

693
00:39:25,239 --> 00:39:27,680
Speaker 1: now going Amazon customers are going to take for granted

694
00:39:28,000 --> 00:39:31,399
Speaker 1: because those fulfillment centers and distribution hubs are now all

695
00:39:31,440 --> 00:39:35,399
Speaker 1: over the country. Let's talk about the store itself first.

696
00:39:35,480 --> 00:39:38,800
Speaker 1: Let's talk about the actual image, what you actually see.

697
00:39:39,280 --> 00:39:43,440
Speaker 1: There's a plethora of advertising, which I find very confusing.

698
00:39:43,800 --> 00:39:47,200
Speaker 1: Can you give us the history of rise of advertising

699
00:39:47,239 --> 00:39:51,560
Speaker 1: on the site? It's really interesting, and I devote a

700
00:39:51,719 --> 00:39:53,440
Speaker 1: chapter to it in the book, and I call the

701
00:39:53,520 --> 00:39:56,560
Speaker 1: chapter the gold Mine in the backyard because it was

702
00:39:56,600 --> 00:40:00,000
Speaker 1: there all along, and and for many years Bezos didn't

703
00:40:00,120 --> 00:40:02,560
Speaker 1: want us, didn't seem to want to rate it. So

704
00:40:03,320 --> 00:40:06,320
Speaker 1: probably about fifteen years ago they started very carefully putting

705
00:40:06,600 --> 00:40:09,640
Speaker 1: banner ads on the site. And Bezos comes to the

706
00:40:09,760 --> 00:40:12,600
Speaker 1: s team with a list of all the product categories

707
00:40:12,600 --> 00:40:14,759
Speaker 1: that he doesn't want to touch, and that's things like

708
00:40:14,800 --> 00:40:19,399
Speaker 1: alcohol and financial instruments and pharmaceuticals. He just says, no way,

709
00:40:19,440 --> 00:40:23,600
Speaker 1: not interested, And it basically reveals a kind of underlying

710
00:40:23,640 --> 00:40:28,480
Speaker 1: skepticism in in you know, basic advertising and in the

711
00:40:28,520 --> 00:40:31,799
Speaker 1: ways in which companies get advertising. So of course, and

712
00:40:31,840 --> 00:40:38,000
Speaker 1: that's with salespeople and and staffs, and Amazon higher salespeople,

713
00:40:38,120 --> 00:40:40,839
Speaker 1: but they always constrained its growth and they're just not

714
00:40:41,000 --> 00:40:44,160
Speaker 1: interested in that kind of revenue or really in cluttering

715
00:40:44,200 --> 00:40:46,840
Speaker 1: up the site with ads. And for many years Amazon

716
00:40:47,040 --> 00:40:51,080
Speaker 1: is analysts are speculating why doesn't Amazon get into advertising

717
00:40:51,080 --> 00:40:53,880
Speaker 1: more significantly. And the turning point is when they discover

718
00:40:54,480 --> 00:40:58,880
Speaker 1: what Google had pioneered a decade before, putting ads in

719
00:40:59,080 --> 00:41:01,840
Speaker 1: search results, and Amazon starts at the bottom of the

720
00:41:01,880 --> 00:41:05,279
Speaker 1: search results page, moves them to the side, and eventually

721
00:41:05,320 --> 00:41:08,680
Speaker 1: Bezos decides that he will let sellers and brands compete

722
00:41:08,920 --> 00:41:11,879
Speaker 1: to get the top ad on the on the search

723
00:41:11,920 --> 00:41:14,680
Speaker 1: results page. And that is the gold mine in the backyard.

724
00:41:14,719 --> 00:41:17,920
Speaker 1: It unlocks a tremendous opportunity. I would argue that it

725
00:41:17,920 --> 00:41:21,160
Speaker 1: actually depreciates I think, as you're referring to the customer

726
00:41:21,239 --> 00:41:24,719
Speaker 1: experience a little bit the search for page. Yeah, but

727
00:41:25,040 --> 00:41:27,680
Speaker 1: and and actually they see that in the test results,

728
00:41:27,719 --> 00:41:31,680
Speaker 1: they see that it's going to lower the customers um

729
00:41:31,760 --> 00:41:35,239
Speaker 1: success rate and getting what they want. But Bezos explicitly

730
00:41:35,280 --> 00:41:40,400
Speaker 1: makes a decision that the bounty of this revenue is

731
00:41:40,440 --> 00:41:43,480
Speaker 1: going to be worth any decrease in the customer experience

732
00:41:43,480 --> 00:41:46,399
Speaker 1: because that is a whole fuel that he can use

733
00:41:46,480 --> 00:41:50,759
Speaker 1: to go invest in Hollywood, create new devices, pioneer new

734
00:41:50,760 --> 00:41:55,200
Speaker 1: product categories, or disrupt new industries. And they make the decision.

735
00:41:55,239 --> 00:41:58,560
Speaker 1: And right now, Amazon search results are less a taxonomy

736
00:41:58,600 --> 00:42:03,000
Speaker 1: and useful result and more a very merchandise page of

737
00:42:03,000 --> 00:42:06,440
Speaker 1: of pay to play advertisements and Amazon's own private label products.

738
00:42:06,520 --> 00:42:09,080
Speaker 1: And that's a decision they made. I would argue it

739
00:42:09,080 --> 00:42:12,560
Speaker 1: wasn't very customer centric, but I think last quarter Baby

740
00:42:12,680 --> 00:42:15,440
Speaker 1: was like six billion dollars was in the other category

741
00:42:15,560 --> 00:42:18,919
Speaker 1: on their on their income statement where they hied advertising

742
00:42:18,920 --> 00:42:21,439
Speaker 1: revenues and and it is one of the fastest growing

743
00:42:21,480 --> 00:42:24,400
Speaker 1: parts of the company right now. Now, let's talk about

744
00:42:24,400 --> 00:42:28,520
Speaker 1: third party sellers. You know how they came up with that? Now,

745
00:42:28,600 --> 00:42:32,480
Speaker 1: all the rules and constraints in the compete competition from China.

746
00:42:34,040 --> 00:42:37,960
Speaker 1: They they celebrate the beginning of their marketplace business as

747
00:42:38,000 --> 00:42:41,480
Speaker 1: starting in two thousand, but it really was as dusty

748
00:42:41,640 --> 00:42:44,920
Speaker 1: repository of used items for almost a decade after that,

749
00:42:45,520 --> 00:42:47,880
Speaker 1: and it was when Bezos is sort of casting about

750
00:42:47,880 --> 00:42:50,640
Speaker 1: for another leader, feeling like they hadn't achieved very much

751
00:42:51,200 --> 00:42:54,239
Speaker 1: with the marketplace, and he was asking executives, how would

752
00:42:54,280 --> 00:42:57,480
Speaker 1: you bring a million sellers onto this platform? And that's

753
00:42:57,480 --> 00:43:02,560
Speaker 1: actually really interesting and revealing question because there's no way

754
00:43:02,600 --> 00:43:04,399
Speaker 1: you can do that hand to hand. It gets back

755
00:43:04,440 --> 00:43:07,480
Speaker 1: to the salesperson point. You can only build a self

756
00:43:07,520 --> 00:43:10,879
Speaker 1: service system that where sellers can go and sign up

757
00:43:11,160 --> 00:43:14,320
Speaker 1: and list their wares on on an Amazon product page

758
00:43:14,320 --> 00:43:17,880
Speaker 1: and start selling to Amazon's customer base tomorrow. So that

759
00:43:18,000 --> 00:43:21,640
Speaker 1: was like the intuition build a self service platform where

760
00:43:21,680 --> 00:43:24,440
Speaker 1: any seller can basically go and sign up. And then

761
00:43:24,480 --> 00:43:26,640
Speaker 1: a couple of things happened well that that took off.

762
00:43:26,680 --> 00:43:28,920
Speaker 1: It was very effective. It meant that a whole generation

763
00:43:28,960 --> 00:43:33,680
Speaker 1: of successful sellers in the West. But then another thing happened,

764
00:43:33,680 --> 00:43:36,759
Speaker 1: which is Ali Baba started to expand outside China and

765
00:43:37,000 --> 00:43:40,240
Speaker 1: a little startup called wish dot Com started to engage

766
00:43:40,239 --> 00:43:43,520
Speaker 1: in a kind of geographical arbitrage where they were allowing

767
00:43:43,640 --> 00:43:46,319
Speaker 1: Chinese sellers very close to the factories or in some

768
00:43:46,400 --> 00:43:50,960
Speaker 1: cases the factories themselves to sell abroad. And Bezos, who

769
00:43:51,000 --> 00:43:54,000
Speaker 1: never wants to be outflanked, essentially, looked at his senior

770
00:43:54,000 --> 00:43:56,400
Speaker 1: executives and said, you guys are on this right. And

771
00:43:56,480 --> 00:44:00,279
Speaker 1: Amazon went to China almost literally, They started sending teams

772
00:44:00,320 --> 00:44:04,400
Speaker 1: of executives there, and they extended those self service platforms

773
00:44:04,680 --> 00:44:09,000
Speaker 1: into China translating from Mandarin, and allowed sellers in China

774
00:44:09,480 --> 00:44:13,640
Speaker 1: to list their wearers on Amazon. Globally. They consolidated their

775
00:44:13,640 --> 00:44:18,279
Speaker 1: merchandise in in in in giant freight yacht ships. They

776
00:44:18,440 --> 00:44:21,360
Speaker 1: moved across the country. They stored it in their fulfillment centers.

777
00:44:21,400 --> 00:44:24,440
Speaker 1: Amazon did, and they offered these products to sail to

778
00:44:24,480 --> 00:44:29,080
Speaker 1: their customers. And it was an explosion of selection. It

779
00:44:29,280 --> 00:44:32,719
Speaker 1: was a proliferation of bizarre brands that no one's ever

780
00:44:32,760 --> 00:44:35,920
Speaker 1: heard of. It was a lot of low priced stuff generally,

781
00:44:36,080 --> 00:44:39,080
Speaker 1: it really I think fueled like the Amazon machine and

782
00:44:39,120 --> 00:44:42,799
Speaker 1: contributed to a lot greater selection and higher sales. But

783
00:44:42,840 --> 00:44:46,279
Speaker 1: it also introduced all kinds of chaos to Amazon. And

784
00:44:46,360 --> 00:44:49,439
Speaker 1: it's it's apparent every time you search for something, um

785
00:44:49,480 --> 00:44:51,880
Speaker 1: you know, not just the no name brands or the

786
00:44:52,400 --> 00:44:55,839
Speaker 1: shenanigans with reviews, but a lot of fraud, a lot

787
00:44:55,840 --> 00:44:59,359
Speaker 1: of counterfeit, a lot of fake reviews. Some real disasters

788
00:44:59,719 --> 00:45:03,239
Speaker 1: U like the exploding hoverboards that were that went in

789
00:45:03,280 --> 00:45:05,480
Speaker 1: the news a couple of years ago, where people were

790
00:45:05,520 --> 00:45:09,320
Speaker 1: buying these hoverboards with lithium ion batteries at Amazon and

791
00:45:09,360 --> 00:45:11,920
Speaker 1: they were they were catching fire when plugged in and

792
00:45:11,960 --> 00:45:15,720
Speaker 1: burning down people's homes. And that is still those cases

793
00:45:15,719 --> 00:45:18,200
Speaker 1: are still winding their way through the court system. So

794
00:45:19,800 --> 00:45:22,320
Speaker 1: in a very Amazon or a very big tech company

795
00:45:22,360 --> 00:45:26,480
Speaker 1: like way, they started creating new systems to address some

796
00:45:26,520 --> 00:45:29,960
Speaker 1: of the unintended consequences. And these are like anti counterfeiting

797
00:45:30,000 --> 00:45:35,200
Speaker 1: tools and tools to preserve the sanctity of the review system.

798
00:45:35,320 --> 00:45:38,120
Speaker 1: But they unlocked a lot of that cast that they

799
00:45:38,160 --> 00:45:40,880
Speaker 1: now have to address by creating a self service global

800
00:45:40,920 --> 00:45:46,400
Speaker 1: marketplace that became international, and really it was almost like

801
00:45:46,640 --> 00:45:52,200
Speaker 1: pure unadulterated globalization in terms of its complete tilting of

802
00:45:52,239 --> 00:45:57,719
Speaker 1: the of the e commerce playing field. Okay, but ultimately

803
00:45:57,880 --> 00:46:01,360
Speaker 1: these products come from China and Western sellers people in

804
00:46:01,360 --> 00:46:04,320
Speaker 1: the United States started bitching they can't compete on price,

805
00:46:05,320 --> 00:46:08,160
Speaker 1: and then there becomes a whole issue that Amazon is

806
00:46:08,200 --> 00:46:10,080
Speaker 1: caught in the middle of that you're addressed in the book.

807
00:46:11,239 --> 00:46:13,839
Speaker 1: I went back. I was trying to figure out how

808
00:46:13,880 --> 00:46:16,520
Speaker 1: to take the temperature of this massive seller community, and

809
00:46:16,520 --> 00:46:19,479
Speaker 1: there's no way you can pull them all, and opinions vary,

810
00:46:19,680 --> 00:46:21,759
Speaker 1: and there's a lot of happy sellers. Then there's a

811
00:46:21,760 --> 00:46:24,399
Speaker 1: lot of economic opportunity on Amazon right now. In fact,

812
00:46:24,640 --> 00:46:27,880
Speaker 1: one recent trend are these these companies that are buying

813
00:46:27,960 --> 00:46:30,840
Speaker 1: up a lot of sellers and rolling them up to

814
00:46:30,920 --> 00:46:34,520
Speaker 1: create bigger entities. But I did think it'd be interesting

815
00:46:34,520 --> 00:46:37,040
Speaker 1: if I went back to every seller who was mentioned

816
00:46:37,120 --> 00:46:40,440
Speaker 1: in Jeff Bezos shareholder letter over the years, who were

817
00:46:40,480 --> 00:46:44,000
Speaker 1: sort of celebrated as as success stories, And so I

818
00:46:44,000 --> 00:46:46,160
Speaker 1: did that, I think going back to around two ten,

819
00:46:46,480 --> 00:46:49,719
Speaker 1: and they had all become embittered, they had all they

820
00:46:49,719 --> 00:46:54,000
Speaker 1: had all lost their enthusiasm. One guy compared to being

821
00:46:54,040 --> 00:46:56,919
Speaker 1: invited over for Thanksgiving dinner only to realize that you're

822
00:46:57,000 --> 00:47:00,880
Speaker 1: the turkey. I thought that was a great quote. And

823
00:47:00,920 --> 00:47:04,880
Speaker 1: what it suggested to me, again because there are happy

824
00:47:04,920 --> 00:47:09,000
Speaker 1: Amazon sellers, is that this is a playing fielder frontier

825
00:47:09,360 --> 00:47:15,120
Speaker 1: that is changing so rapidly that yesterday's winners are not

826
00:47:15,360 --> 00:47:19,279
Speaker 1: are are sometimes today's losers. That you have to constantly

827
00:47:19,320 --> 00:47:22,879
Speaker 1: reinvent yourself in much the same way that Amazon does.

828
00:47:23,280 --> 00:47:26,360
Speaker 1: If you want to be successful on Amazon, and you know,

829
00:47:26,400 --> 00:47:29,680
Speaker 1: you have sellers that were devoted to single product categories

830
00:47:29,719 --> 00:47:33,280
Speaker 1: like paddle boards, and they did a great, great business

831
00:47:33,280 --> 00:47:35,759
Speaker 1: on Amazon for for a couple of years, and then

832
00:47:35,800 --> 00:47:39,280
Speaker 1: when the marketplace globalized. You know, they're getting their supply

833
00:47:39,360 --> 00:47:42,040
Speaker 1: from a Chinese manufacturer, So it kind of makes sense

834
00:47:42,560 --> 00:47:45,960
Speaker 1: that that manufacturer, someone very close to it would say,

835
00:47:45,960 --> 00:47:48,480
Speaker 1: why are we going through a middleman in the United States.

836
00:47:48,520 --> 00:47:51,120
Speaker 1: Here's the opportunity to go direct, and they do that

837
00:47:51,320 --> 00:47:54,399
Speaker 1: and the middleman is disrupted. And so that is a

838
00:47:54,440 --> 00:47:58,600
Speaker 1: common experience on Amazon. They really do celebrate the Super

839
00:47:58,640 --> 00:48:01,200
Speaker 1: Bowl ads are all about the lights turning on in

840
00:48:01,320 --> 00:48:04,799
Speaker 1: the Middle America. Would working shop, you know, where an

841
00:48:04,880 --> 00:48:08,080
Speaker 1: entrepreneurs pursuing his or her dreams on Amazon where the

842
00:48:08,120 --> 00:48:10,319
Speaker 1: reality of it, I think it's a little different. I

843
00:48:10,360 --> 00:48:14,320
Speaker 1: think that it's really now tilted in favor of the entrepreneurs,

844
00:48:14,320 --> 00:48:18,239
Speaker 1: the businesses that are in in low wage, low tax countries,

845
00:48:18,640 --> 00:48:21,799
Speaker 1: very close to manufacturers who have some of the advantages.

846
00:48:21,840 --> 00:48:25,720
Speaker 1: I think that Amazon is availing to to these countries

847
00:48:25,800 --> 00:48:28,919
Speaker 1: like like China where they they really are and they

848
00:48:28,960 --> 00:48:31,200
Speaker 1: feel like they're in competition with the Ali Baba's and

849
00:48:31,200 --> 00:48:33,640
Speaker 1: wishes of the world, and they're trying to capture that

850
00:48:33,640 --> 00:48:39,120
Speaker 1: global supply. Now, Amazon keeps changing the rules, tightening the screw.

851
00:48:39,239 --> 00:48:43,480
Speaker 1: As we sit here, DC is cracking down saying that

852
00:48:43,840 --> 00:48:47,319
Speaker 1: if you sell on Amazon, you can't sell cheaper elsewhere.

853
00:48:47,840 --> 00:48:49,799
Speaker 1: You know, what do we know the government, especially when

854
00:48:49,840 --> 00:48:52,000
Speaker 1: it comes to tech, it's always a few steps behind,

855
00:48:52,840 --> 00:48:54,719
Speaker 1: you know. Is the Amazon just going to continue to

856
00:48:54,719 --> 00:48:59,600
Speaker 1: get away with this behavior or is something going to change? Well,

857
00:48:59,680 --> 00:49:02,480
Speaker 1: let me break this specific case down a little bit.

858
00:49:02,560 --> 00:49:07,160
Speaker 1: So this is the Attorney General of Washington, d C.

859
00:49:07,400 --> 00:49:11,600
Speaker 1: And he's basically putting his finger on um, what's what

860
00:49:11,800 --> 00:49:14,759
Speaker 1: they call him. The business like most favored nation clauses

861
00:49:14,800 --> 00:49:18,240
Speaker 1: in the agreements between Amazon and sellers, And what Amazon

862
00:49:18,280 --> 00:49:21,520
Speaker 1: tell sellers is you can't go to Walmart or your

863
00:49:21,560 --> 00:49:25,880
Speaker 1: own website or Target and list for lower a lower

864
00:49:25,920 --> 00:49:29,400
Speaker 1: price than you're listing for on Amazon. And by the way,

865
00:49:29,239 --> 00:49:32,160
Speaker 1: I'm pretty sure Walmart and other retailers do that as well.

866
00:49:32,680 --> 00:49:35,440
Speaker 1: And and Amazon has kind of backed away from that

867
00:49:35,480 --> 00:49:37,719
Speaker 1: in the past over the past few years, but they

868
00:49:37,760 --> 00:49:41,920
Speaker 1: still implemented in some non subtle ways. They go and

869
00:49:42,000 --> 00:49:45,440
Speaker 1: find a product elsewhere for cheaper. They're gonna pull you

870
00:49:45,480 --> 00:49:48,680
Speaker 1: from the search results. You're it's gonna be harder to buy.

871
00:49:48,719 --> 00:49:52,120
Speaker 1: And so they really are implement They're implementing the same

872
00:49:52,200 --> 00:49:55,680
Speaker 1: techniques now. And one thing that we should just say

873
00:49:55,880 --> 00:49:58,400
Speaker 1: so people understand it is that all these retail sites

874
00:49:58,400 --> 00:50:02,719
Speaker 1: are scraping each other. They have automated software. Amazon is

875
00:50:02,760 --> 00:50:06,160
Speaker 1: looking at Walmart all the time, and vice versa, ad nauseam.

876
00:50:06,440 --> 00:50:11,239
Speaker 1: All these companies have kind of binoculars trained algorithmic binoculars

877
00:50:11,280 --> 00:50:13,880
Speaker 1: trained on each other to see where prices are lower.

878
00:50:14,520 --> 00:50:16,600
Speaker 1: And what the A G Is saying is that, you know,

879
00:50:16,640 --> 00:50:20,520
Speaker 1: that is in effect of forcing a higher price Amazon

880
00:50:20,600 --> 00:50:25,120
Speaker 1: to Amazon's forcing a higher price elsewhere and not allowing

881
00:50:25,719 --> 00:50:32,360
Speaker 1: its sellers to to discount elsewhere. Look, historically that was legal,

882
00:50:32,520 --> 00:50:34,840
Speaker 1: and I think the question is as Amazon gets bigger

883
00:50:34,880 --> 00:50:39,000
Speaker 1: and accumulates power, as it commands an ever larger share

884
00:50:39,239 --> 00:50:42,880
Speaker 1: of um of of e commerce, does it start to

885
00:50:42,960 --> 00:50:45,359
Speaker 1: kind of look bad? And as I said, Amazon backed

886
00:50:45,360 --> 00:50:47,239
Speaker 1: away from a form of it, but still does it

887
00:50:47,560 --> 00:50:51,279
Speaker 1: in some quieter ways. I think ultimately, my guest Bob

888
00:50:51,360 --> 00:50:54,640
Speaker 1: is that they probably stopped doing that, you know, just

889
00:50:54,800 --> 00:50:58,160
Speaker 1: because of the optics. I don't think this antitrust case

890
00:50:58,280 --> 00:51:01,560
Speaker 1: is existential in any way. It's about one particular form

891
00:51:01,560 --> 00:51:05,080
Speaker 1: of conduct, something that everybody kind of historically has done,

892
00:51:05,239 --> 00:51:08,120
Speaker 1: by which Amazon doing tends to tends to look bad.

893
00:51:08,400 --> 00:51:11,879
Speaker 1: And I think ultimately that they settle this case. Yes,

894
00:51:11,960 --> 00:51:14,200
Speaker 1: now we expand this and go back to your first

895
00:51:14,280 --> 00:51:17,319
Speaker 1: book with the example of diapers dot com. If for

896
00:51:17,440 --> 00:51:22,680
Speaker 1: whatever reason, Amazon wants to be in your business, it

897
00:51:22,760 --> 00:51:25,520
Speaker 1: appears they'll just put you out of business, or they

898
00:51:25,560 --> 00:51:28,440
Speaker 1: said to Zappos. Now, these are historical issues at this point,

899
00:51:28,719 --> 00:51:32,319
Speaker 1: you know, either sell or compete, and forgetting that they

900
00:51:32,360 --> 00:51:35,640
Speaker 1: ultimately got out of the diaper's business after selling after

901
00:51:35,800 --> 00:51:39,400
Speaker 1: buying the diaper business. A lot of third party sellers say, well,

902
00:51:39,440 --> 00:51:42,600
Speaker 1: if I have a big business selling battery, selling anything,

903
00:51:42,880 --> 00:51:45,480
Speaker 1: they're gonna look at my data. They're just gonna make

904
00:51:45,480 --> 00:51:51,000
Speaker 1: it so they win. And do you believe this is conscious?

905
00:51:51,480 --> 00:51:53,960
Speaker 1: This bleeds into the other issue. You know, at the

906
00:51:54,000 --> 00:51:57,680
Speaker 1: street level, they say that Amazon makes more money selling

907
00:51:57,760 --> 00:52:01,759
Speaker 1: third party products and it does sell its own products.

908
00:52:01,840 --> 00:52:04,200
Speaker 1: So what is the viewpoint of the Amazon and all

909
00:52:04,239 --> 00:52:07,600
Speaker 1: this stuff. Well, let me let me take a couple

910
00:52:07,600 --> 00:52:11,000
Speaker 1: of pieces there. I mean that the quizzy story of

911
00:52:11,120 --> 00:52:14,240
Speaker 1: now ten years ago, which I tell me everything stories

912
00:52:14,400 --> 00:52:19,840
Speaker 1: is interesting. Amazon was in hot competition with the company

913
00:52:19,840 --> 00:52:23,520
Speaker 1: that owned Diapers dot Com. Discounted the product until everyone

914
00:52:23,600 --> 00:52:26,840
Speaker 1: was kind of losing money, forced Quizzy into a sale,

915
00:52:27,560 --> 00:52:30,920
Speaker 1: bought the asset. I think they feared, like Zappos, this

916
00:52:30,960 --> 00:52:33,200
Speaker 1: could be one of those companies that could be acquired

917
00:52:33,200 --> 00:52:36,520
Speaker 1: by Walmart or funded by venture capital and Silicon Valley

918
00:52:36,520 --> 00:52:39,960
Speaker 1: and become really a full featured competitor. And instead they

919
00:52:39,960 --> 00:52:43,120
Speaker 1: bought it, and then they allowed it to run independently

920
00:52:43,239 --> 00:52:45,600
Speaker 1: and then eventually closed it down. They did not get

921
00:52:45,640 --> 00:52:48,960
Speaker 1: out of the diapers business though, diapers. They still sell

922
00:52:49,000 --> 00:52:51,400
Speaker 1: tons of diapers on Amazon dot Com. I thought that

923
00:52:51,480 --> 00:52:54,680
Speaker 1: they closed that down just you know, they closed down

924
00:52:54,719 --> 00:52:58,520
Speaker 1: diapers dot com right, they bought diapers dot Com. They

925
00:52:58,560 --> 00:53:01,840
Speaker 1: allowed it to run independently, and eventually they did shut

926
00:53:01,840 --> 00:53:04,920
Speaker 1: down that website. But on Amazon dot Com, not only

927
00:53:05,000 --> 00:53:09,840
Speaker 1: can you find all manners of Pampers and Huggies and

928
00:53:09,840 --> 00:53:13,120
Speaker 1: and Amazon Amazon's own private label products. There they do

929
00:53:13,360 --> 00:53:15,480
Speaker 1: a brisk business and diapers. They just don't have a

930
00:53:15,480 --> 00:53:19,919
Speaker 1: separate website anymore. For example, Zappos is still zappos dot Com.

931
00:53:20,000 --> 00:53:22,120
Speaker 1: You can still go and buy sneakers there. You can

932
00:53:22,160 --> 00:53:25,959
Speaker 1: also buy sneakers on Amazon, so they sometimes buy these

933
00:53:26,000 --> 00:53:31,080
Speaker 1: other companies two uh to, I think the close off

934
00:53:31,200 --> 00:53:34,759
Speaker 1: future opportunity for them, right and and look, I think

935
00:53:34,760 --> 00:53:37,560
Speaker 1: that the government has looked at that. The House Antitrust

936
00:53:37,600 --> 00:53:40,719
Speaker 1: Subcommittee devoted paragraph to that. And so of course my

937
00:53:40,800 --> 00:53:44,000
Speaker 1: book was was my first book was cited there. The

938
00:53:44,040 --> 00:53:47,920
Speaker 1: way in which they Amazon conducted itself back then to

939
00:53:48,080 --> 00:53:51,560
Speaker 1: pursue rivals, I think was was extraordinary. They cannot get

940
00:53:51,560 --> 00:53:54,240
Speaker 1: away with that anymore. It's a it's a much larger

941
00:53:54,280 --> 00:53:57,080
Speaker 1: and more scrutinized company. And in fact, I actually don't

942
00:53:57,160 --> 00:54:01,680
Speaker 1: think acquisitions like like uh Quidzy or Zappos, if they

943
00:54:01,719 --> 00:54:04,920
Speaker 1: were doing those types of acquisitions today, they would necessarily

944
00:54:04,960 --> 00:54:07,799
Speaker 1: get them through the FTC. MGM is a different matter

945
00:54:07,840 --> 00:54:10,520
Speaker 1: which we could talk about UM. But then you talked

946
00:54:10,520 --> 00:54:14,560
Speaker 1: about then you then you talked about UM. The marketplace

947
00:54:14,560 --> 00:54:17,240
Speaker 1: of vendors on Amazon dot com and whether Amazon peaks

948
00:54:17,239 --> 00:54:20,480
Speaker 1: at their data to put out their own private label products,

949
00:54:20,719 --> 00:54:23,000
Speaker 1: and my book shows that they have. You know that

950
00:54:23,280 --> 00:54:26,239
Speaker 1: that that managers did that. There was a policy against it,

951
00:54:26,320 --> 00:54:28,400
Speaker 1: as we talked about, they did it anyway because they

952
00:54:28,400 --> 00:54:30,600
Speaker 1: were trying to meet their goals, and Amazon has to

953
00:54:30,640 --> 00:54:34,319
Speaker 1: answer some really hard questions about that. Again, they are

954
00:54:34,360 --> 00:54:38,480
Speaker 1: now under the microscope. I wouldn't be surprised if there

955
00:54:38,480 --> 00:54:41,920
Speaker 1: are some very strict policies if the cookie jar is

956
00:54:42,000 --> 00:54:44,040
Speaker 1: kind of nailed chat right now in terms of access

957
00:54:44,080 --> 00:54:48,080
Speaker 1: to that third party data. You know, it doesn't excuse

958
00:54:48,120 --> 00:54:52,040
Speaker 1: the conduct that happened in the past. Amazon likes to

959
00:54:52,080 --> 00:54:54,239
Speaker 1: say that, well, if you go into a Costco, it's

960
00:54:54,239 --> 00:54:57,040
Speaker 1: all Kirkland, if you go into a Walmart, Walmart, their

961
00:54:57,080 --> 00:55:00,279
Speaker 1: private label brands are predominant and actually private able, and

962
00:55:00,320 --> 00:55:03,120
Speaker 1: Amazon's a small percentage of their overall sales, it's actually

963
00:55:03,200 --> 00:55:06,200
Speaker 1: quite prominent in search results. So it's another thing that

964
00:55:06,200 --> 00:55:08,480
Speaker 1: Amazon's going to have to answer for the fact that

965
00:55:08,640 --> 00:55:12,120
Speaker 1: they are quite explicitly in competition with their own not

966
00:55:12,200 --> 00:55:15,120
Speaker 1: just their own brands, but their own sellers. They're a platform,

967
00:55:15,440 --> 00:55:18,759
Speaker 1: They're a retail store, and then increasingly they're they're a

968
00:55:18,760 --> 00:55:22,680
Speaker 1: white label manufacture because a lot of those products and

969
00:55:22,719 --> 00:55:26,279
Speaker 1: I think a large amount of their sales growth is

970
00:55:26,320 --> 00:55:35,200
Speaker 1: coming from private label. Let's talk about a WS Amazon

971
00:55:35,320 --> 00:55:39,680
Speaker 1: Web Services. Uh, it starts, it's the only game in town.

972
00:55:39,840 --> 00:55:44,400
Speaker 1: They price it relatively reasonable. There's first mover advantage to

973
00:55:44,600 --> 00:55:47,759
Speaker 1: degree people are paying attention. All of a sudden under

974
00:55:47,800 --> 00:55:52,319
Speaker 1: the Trump administration, the Defense Department gives a huge contract

975
00:55:52,880 --> 00:55:57,799
Speaker 1: to Microsoft, then it's reevaluated, then Microsoft gets again the

976
00:55:57,840 --> 00:56:02,080
Speaker 1: most recent stories. They might lead it up. But what

977
00:56:02,280 --> 00:56:06,400
Speaker 1: is the future of the web services industry and Amazon's

978
00:56:06,440 --> 00:56:11,239
Speaker 1: police in it. It's incredibly competitive now. Um, Amazon is

979
00:56:11,280 --> 00:56:14,040
Speaker 1: in the lead, but Microsoft is nipping at its heels.

980
00:56:14,080 --> 00:56:16,319
Speaker 1: Google's a little bit farther behind, and then you have

981
00:56:16,360 --> 00:56:20,279
Speaker 1: IBM and Oracle and innumerable other players. These are the

982
00:56:20,360 --> 00:56:24,040
Speaker 1: largest technology companies in the world, and of course Microsoft

983
00:56:24,080 --> 00:56:27,600
Speaker 1: by market cap is larger than Amazon. So I think

984
00:56:27,880 --> 00:56:32,080
Speaker 1: there's obviously tremendous growth in cloud computing the way that

985
00:56:32,440 --> 00:56:36,640
Speaker 1: you know governments have embraced it. And then the the

986
00:56:37,320 --> 00:56:41,360
Speaker 1: scramble for for contracts like the Jedi contract, which Amazon

987
00:56:41,480 --> 00:56:44,279
Speaker 1: loss to Microsoft during the Trump years, but which might

988
00:56:44,280 --> 00:56:47,760
Speaker 1: be getting reawarded soon depending on on on the legal

989
00:56:47,800 --> 00:56:51,960
Speaker 1: outcome of Amazon's protest. This is the direction of enterprise

990
00:56:52,000 --> 00:56:55,719
Speaker 1: software and enter enterprise computing, and Amazon has been a pioneer,

991
00:56:55,760 --> 00:56:58,200
Speaker 1: but it's no longer the only one. So if if

992
00:56:58,239 --> 00:57:03,640
Speaker 1: you're asking about you know, a a legislator or regulator's

993
00:57:03,640 --> 00:57:05,920
Speaker 1: ability to make a case that Amazon has a dominant

994
00:57:05,920 --> 00:57:08,520
Speaker 1: position in cloud computing. I think that right now that

995
00:57:08,640 --> 00:57:11,440
Speaker 1: there's a pretty weak case there. What what's more interesting

996
00:57:11,520 --> 00:57:15,839
Speaker 1: or maybe some of the very opaque ties between AWS

997
00:57:15,840 --> 00:57:19,600
Speaker 1: and Amazon retail and that's really not all that well understood,

998
00:57:19,600 --> 00:57:22,280
Speaker 1: and it's something that the House Antitrust Subcommittee last year

999
00:57:22,840 --> 00:57:26,480
Speaker 1: express frustration within their ultimate report, like how do why

1000
00:57:26,680 --> 00:57:29,919
Speaker 1: are these units together? How do they nurture each other?

1001
00:57:31,160 --> 00:57:33,520
Speaker 1: Actually a lot of people internally don't even quite know,

1002
00:57:33,640 --> 00:57:35,880
Speaker 1: but I suspect that they really help each other. That

1003
00:57:35,960 --> 00:57:40,720
Speaker 1: retail plays a wholesale price for for AWS, and AWS

1004
00:57:40,760 --> 00:57:44,640
Speaker 1: has this available beta tester for new services that allows

1005
00:57:44,640 --> 00:57:47,800
Speaker 1: it to scale very quickly, and that this is you know,

1006
00:57:48,240 --> 00:57:50,600
Speaker 1: have been a very productive union for both sides of

1007
00:57:50,600 --> 00:57:53,680
Speaker 1: the company, and that Bezos and any Jesse would would

1008
00:57:53,680 --> 00:57:57,960
Speaker 1: not willingly separate them. Let's go into entertainment. Yes, this

1009
00:57:58,080 --> 00:58:01,520
Speaker 1: became a benefit with Prime. So this is a different

1010
00:58:01,680 --> 00:58:05,080
Speaker 1: model from the competitors, certainly Netflix, which is, you know,

1011
00:58:05,120 --> 00:58:07,680
Speaker 1: owns its own vertical so what do we know? The

1012
00:58:07,760 --> 00:58:12,080
Speaker 1: policy is different. They'll allow almost anything on their site,

1013
00:58:12,480 --> 00:58:17,680
Speaker 1: their interface is non attractive. They don't have huge success,

1014
00:58:17,720 --> 00:58:21,600
Speaker 1: although it's hard to tell. Also, adding in the music thing,

1015
00:58:21,760 --> 00:58:25,360
Speaker 1: once you start bundling, they are beating the ten dollar

1016
00:58:25,560 --> 00:58:28,600
Speaker 1: price that other companies have. They don't real they don't

1017
00:58:28,600 --> 00:58:31,240
Speaker 1: really break out a lot of information. But is it

1018
00:58:31,440 --> 00:58:34,880
Speaker 1: just a matter of time till they get entertainment right

1019
00:58:35,400 --> 00:58:37,480
Speaker 1: or really they don't have the right people in place,

1020
00:58:38,120 --> 00:58:41,160
Speaker 1: You know, I would I would say that I'm not

1021
00:58:41,200 --> 00:58:44,600
Speaker 1: so sure. I agree with the premise. You know, Amazon actually,

1022
00:58:44,920 --> 00:58:47,600
Speaker 1: in a very typical way, has a lot of ways

1023
00:58:47,640 --> 00:58:50,720
Speaker 1: to win. And we look at Prime Video and I

1024
00:58:50,760 --> 00:58:53,360
Speaker 1: totally agree that the menu that shows up on the

1025
00:58:53,400 --> 00:58:56,600
Speaker 1: screen is sometimes bizarre and what am I looking at?

1026
00:58:56,640 --> 00:59:00,480
Speaker 1: And why can't I find anything? And the original original

1027
00:59:00,520 --> 00:59:04,440
Speaker 1: content that they've produced from their Hollywood division has more

1028
00:59:04,560 --> 00:59:06,959
Speaker 1: mrs than hits. There there have been some great things

1029
00:59:07,000 --> 00:59:10,520
Speaker 1: like Fleabag and the marvelous Mrs. Maisel and Transparent. That's

1030
00:59:10,600 --> 00:59:13,840
Speaker 1: kind of niche programming, but then Jack Ryan maybe has

1031
00:59:13,880 --> 00:59:16,840
Speaker 1: done a little better, and The Boys I found entertaining,

1032
00:59:17,040 --> 00:59:21,240
Speaker 1: and then they some great movies. Um, I love the

1033
00:59:21,240 --> 00:59:24,880
Speaker 1: sound of Metal. I don't know if you saw that one, Bob, Yeah,

1034
00:59:24,960 --> 00:59:28,240
Speaker 1: so good. Bore at two was horrendous and somehow people

1035
00:59:28,280 --> 00:59:30,720
Speaker 1: have watched and I couldn't watch it. I know I'm

1036
00:59:30,720 --> 00:59:32,920
Speaker 1: not a huge fan of his, but I where he

1037
00:59:33,080 --> 00:59:36,560
Speaker 1: was going on an intellectual level. I just brilliant. Okay,

1038
00:59:36,640 --> 00:59:38,400
Speaker 1: So but here's here's the point that's trying to make.

1039
00:59:39,040 --> 00:59:42,800
Speaker 1: Amazon doesn't That's part of their strategy. They also have

1040
00:59:43,360 --> 00:59:46,960
Speaker 1: the set top box, the Fire TV stick, probably one

1041
00:59:46,960 --> 00:59:50,640
Speaker 1: of the most successful streaming products alongside Roku. And then

1042
00:59:50,960 --> 00:59:53,800
Speaker 1: you look at Disney Plus and you look at Netflix,

1043
00:59:53,880 --> 00:59:56,920
Speaker 1: and I actually think elements of Apple TV Plus, if

1044
00:59:56,960 --> 01:00:00,120
Speaker 1: not the whole thing. Those running a ws amaz on

1045
01:00:00,240 --> 01:00:03,840
Speaker 1: a loan in this scramble to create an entertainment future,

1046
01:00:04,240 --> 01:00:08,000
Speaker 1: is operating at every level of the stack and succeeding

1047
01:00:08,080 --> 01:00:10,080
Speaker 1: at a at a lot of those places. So it

1048
01:00:10,160 --> 01:00:12,680
Speaker 1: has a lot of advantages here. It's got a lot

1049
01:00:12,720 --> 01:00:15,960
Speaker 1: of resources in cash that it's devoting. It's spent eleven

1050
01:00:16,000 --> 01:00:19,400
Speaker 1: billion dollars on Prime Video in two thousand twenty. Now

1051
01:00:19,440 --> 01:00:21,680
Speaker 1: they're paying for for MGM, so they're going to deepen

1052
01:00:21,680 --> 01:00:25,160
Speaker 1: their catalog and they're getting access, you know, depending on

1053
01:00:25,200 --> 01:00:27,640
Speaker 1: how you view the MGM library to a lot of

1054
01:00:27,680 --> 01:00:32,280
Speaker 1: I P and potential for franchises and spinoffs. So I

1055
01:00:32,440 --> 01:00:36,080
Speaker 1: don't think that Amazon's foray into Hollywood has been really

1056
01:00:36,240 --> 01:00:38,480
Speaker 1: we could say it's been unsuccessful. In fact, in a

1057
01:00:38,480 --> 01:00:41,680
Speaker 1: lot of ways they're pioneers. Maybe in the Flasher Flasher

1058
01:00:41,760 --> 01:00:44,720
Speaker 1: aspects of it, they've had a checkered history, But I

1059
01:00:44,760 --> 01:00:47,240
Speaker 1: do think it's a matter of time. The resources that

1060
01:00:47,320 --> 01:00:50,120
Speaker 1: this company is able to bring to bear, the deep pockets,

1061
01:00:50,400 --> 01:00:53,640
Speaker 1: the fact that they really kind of don't explicitly charge

1062
01:00:53,920 --> 01:00:56,800
Speaker 1: for Prime video, that it's wrapped up into this nebulous

1063
01:00:56,880 --> 01:01:01,440
Speaker 1: idea of prime which includes UH ship and includes access

1064
01:01:01,480 --> 01:01:04,560
Speaker 1: to music and kindle. People don't really think about what

1065
01:01:04,600 --> 01:01:06,640
Speaker 1: they're paying for this as in the same way that

1066
01:01:06,680 --> 01:01:09,480
Speaker 1: they might for Netflix every month. So I think Amazon

1067
01:01:09,560 --> 01:01:12,400
Speaker 1: actually has a lot of tools at its disposal to

1068
01:01:12,480 --> 01:01:15,800
Speaker 1: ultimately really succeed. Now, if you look at the purchase

1069
01:01:15,840 --> 01:01:19,240
Speaker 1: of MGM, you know this is a whole separate issue

1070
01:01:19,320 --> 01:01:23,480
Speaker 1: the percent perception of the Amazon's marketplace share relative to

1071
01:01:23,560 --> 01:01:27,959
Speaker 1: the reality. But under conventional as employed in the last

1072
01:01:28,000 --> 01:01:32,000
Speaker 1: couple of decades uh antitrust laws, it's hard to see

1073
01:01:32,000 --> 01:01:35,320
Speaker 1: a problem with the purchase of MGM, But it does

1074
01:01:35,400 --> 01:01:38,760
Speaker 1: appear that they overpaid for it. But it's just that

1075
01:01:38,880 --> 01:01:42,000
Speaker 1: these companies, just like Microsoft buying Skype in Nokia, they

1076
01:01:42,040 --> 01:01:44,600
Speaker 1: have so much damn money that it just doesn't make

1077
01:01:44,600 --> 01:01:48,680
Speaker 1: a difference. Well, I mean, Senate, we're hearing Senator Klobascher

1078
01:01:48,840 --> 01:01:52,000
Speaker 1: and other politicians grumble about this, But ultimately the FTC

1079
01:01:52,160 --> 01:01:54,040
Speaker 1: or the d o J is going to ask is

1080
01:01:54,080 --> 01:01:57,200
Speaker 1: this limiting? Is this still limiting competition? And when you

1081
01:01:57,280 --> 01:01:59,880
Speaker 1: look at at the streaming landscape that we just talked about,

1082
01:02:00,000 --> 01:02:03,360
Speaker 1: there are lots of alternatives in terms of studios and content.

1083
01:02:03,560 --> 01:02:05,840
Speaker 1: MGM is not a big player, So I think it's

1084
01:02:05,880 --> 01:02:07,920
Speaker 1: really hard to make the argument that this deal is

1085
01:02:07,960 --> 01:02:11,080
Speaker 1: anti competitive. I think Amazon will get it approved despite

1086
01:02:11,120 --> 01:02:15,280
Speaker 1: probably a hostile political environment. Um. And then the second

1087
01:02:15,280 --> 01:02:21,040
Speaker 1: party of your question, which is now promptly escaped me, well,

1088
01:02:21,120 --> 01:02:25,480
Speaker 1: the perception of Amazon in terms of market Here people

1089
01:02:25,520 --> 01:02:28,400
Speaker 1: always saying Amazon is the enemy, but then they trot

1090
01:02:28,400 --> 01:02:31,840
Speaker 1: out statistics, what percentage of retail they have and all

1091
01:02:31,880 --> 01:02:34,120
Speaker 1: these other things to try to prove that, no, that's

1092
01:02:34,160 --> 01:02:38,280
Speaker 1: not true. Right, Critics are trying to make the case

1093
01:02:38,320 --> 01:02:41,680
Speaker 1: that Amazon is a monopolist, and the challenge there is

1094
01:02:41,760 --> 01:02:44,480
Speaker 1: that it operates in such large markets, and so we

1095
01:02:44,560 --> 01:02:48,360
Speaker 1: talked about cloud computing and and the very big competitors

1096
01:02:48,400 --> 01:02:51,560
Speaker 1: it has with with Google and Microsoft. And then in

1097
01:02:51,560 --> 01:02:54,000
Speaker 1: in retail, when you look at you know, Walmart and

1098
01:02:54,560 --> 01:03:00,479
Speaker 1: Target and Costco and the large supermarket chains, it's gonna

1099
01:03:00,480 --> 01:03:04,840
Speaker 1: be tricky for regulators or lawmakers to write law or

1100
01:03:04,960 --> 01:03:10,280
Speaker 1: to to make judgments that applied just to Amazon that

1101
01:03:10,320 --> 01:03:12,720
Speaker 1: don't apply across the board, and that don't end up

1102
01:03:12,720 --> 01:03:15,760
Speaker 1: maybe even augmenting Amazon's power. I'll give you an example.

1103
01:03:15,800 --> 01:03:18,720
Speaker 1: If you were to say tomorrow that retailers weren't allowed

1104
01:03:18,760 --> 01:03:22,360
Speaker 1: to sell private label products or compete with their own vendors,

1105
01:03:23,240 --> 01:03:26,840
Speaker 1: that would cripple a company like Costco, probably probably a

1106
01:03:26,840 --> 01:03:30,360
Speaker 1: Walmart as well, certainly the drug store chains. And Amazon

1107
01:03:30,440 --> 01:03:35,920
Speaker 1: might actually get more profitable because suddenly, uh, those vendors

1108
01:03:36,600 --> 01:03:40,520
Speaker 1: or marketplace sellers that found their listings eclipsed by Amazon

1109
01:03:40,600 --> 01:03:43,920
Speaker 1: products would be back there paying fees and advertising to

1110
01:03:43,920 --> 01:03:47,160
Speaker 1: get in front of customers. So, I you know, Bezos

1111
01:03:47,200 --> 01:03:50,400
Speaker 1: says he welcomes scrutiny. I think, and obviously they're deploying

1112
01:03:50,440 --> 01:03:52,439
Speaker 1: quite a large lobbying force. I think there are lots

1113
01:03:52,440 --> 01:03:56,000
Speaker 1: of outcomes that end up solidifying Amazon's power, you know,

1114
01:03:56,120 --> 01:03:58,280
Speaker 1: rather than reducing it. And then to the original point,

1115
01:03:58,560 --> 01:04:01,919
Speaker 1: it's not a monopoly and that monopolis in the traditional sense.

1116
01:04:01,920 --> 01:04:04,280
Speaker 1: So I think it's gonna be challenging for regulators to

1117
01:04:04,320 --> 01:04:07,160
Speaker 1: make that case. Let's talk about hardware. They have the

1118
01:04:07,760 --> 01:04:13,120
Speaker 1: firephone disaster, you mentioned the firestick successful, you have the

1119
01:04:13,200 --> 01:04:18,080
Speaker 1: fire tablet, you have the Kindle, you have the Alexa

1120
01:04:18,160 --> 01:04:24,320
Speaker 1: hardware products. What do we know about Amazon traditionally? One point, oh,

1121
01:04:24,680 --> 01:04:27,840
Speaker 1: is kind of crappy, and then they get it better.

1122
01:04:27,880 --> 01:04:30,640
Speaker 1: They never get it to the level of Apple, but

1123
01:04:30,720 --> 01:04:35,240
Speaker 1: they certainly get it to a serviceable level. Now Amazon's

1124
01:04:35,360 --> 01:04:40,360
Speaker 1: Kindle is crippled by the Apple antitrust case. So when

1125
01:04:40,480 --> 01:04:43,960
Speaker 1: something like that happens in Amazon, is there a conscious

1126
01:04:44,000 --> 01:04:48,000
Speaker 1: because you know, Basil's philosophy was, we're gonna lower prices,

1127
01:04:48,040 --> 01:04:50,640
Speaker 1: sell more books. We're gonna blow this world up to

1128
01:04:50,760 --> 01:04:54,560
Speaker 1: the advantage of publishers. Okay, so when they put a

1129
01:04:54,640 --> 01:04:57,080
Speaker 1: roadblock in, I mean, is the Kindle busines, Well, that's

1130
01:04:57,080 --> 01:04:59,560
Speaker 1: a business and it'll run, but you know, we're not

1131
01:04:59,600 --> 01:05:03,120
Speaker 1: focused thing on that anymore. I feel like the Kindle

1132
01:05:03,400 --> 01:05:06,560
Speaker 1: is like the children from a child from a former marriage,

1133
01:05:07,280 --> 01:05:09,680
Speaker 1: right that it was, it was the center of it

1134
01:05:09,760 --> 01:05:12,840
Speaker 1: was the apple of his eye ten years ago. And

1135
01:05:12,960 --> 01:05:15,600
Speaker 1: now they have moved on and the new kids are

1136
01:05:15,640 --> 01:05:20,240
Speaker 1: Alexa and uh, you know maybe the the the Echo

1137
01:05:20,280 --> 01:05:24,680
Speaker 1: buds and this whole other ecosystem of products. So they

1138
01:05:24,840 --> 01:05:28,680
Speaker 1: it's it's interesting unlike Apple, which has this limited span

1139
01:05:28,720 --> 01:05:32,400
Speaker 1: of products that they cherish and nourish and keep updating. Yeah,

1140
01:05:32,600 --> 01:05:35,360
Speaker 1: they Amazon moves on right They produced a lot of stuff.

1141
01:05:35,400 --> 01:05:37,840
Speaker 1: It's not to say they're not updating the Kindle right

1142
01:05:37,920 --> 01:05:40,320
Speaker 1: all the time or the Kindle Fire tablet, but you

1143
01:05:40,400 --> 01:05:42,560
Speaker 1: get the sense that it's a little bit of of

1144
01:05:42,600 --> 01:05:45,520
Speaker 1: an afterthought right now. The company tries a lot of things,

1145
01:05:45,520 --> 01:05:48,680
Speaker 1: a lot of strange things. Did you remember hearing about

1146
01:05:48,720 --> 01:05:52,440
Speaker 1: the Halo wrist band which was reading people's moods or

1147
01:05:52,480 --> 01:05:56,160
Speaker 1: the Alexas spectacles that I guess is maybe gathering some

1148
01:05:56,280 --> 01:05:59,480
Speaker 1: diagnostic data because it came from their healthcare group. And

1149
01:05:59,480 --> 01:06:02,880
Speaker 1: then you've got the Echo buds. It's the second generation

1150
01:06:03,240 --> 01:06:05,760
Speaker 1: is out now, and it was just an example that's

1151
01:06:05,760 --> 01:06:09,240
Speaker 1: on my mind. This thing is brutally reviewed on Amazon itself.

1152
01:06:09,280 --> 01:06:12,040
Speaker 1: It's like two and a half stars, and yet they

1153
01:06:12,560 --> 01:06:14,720
Speaker 1: keep and of course people don't even know about it.

1154
01:06:14,720 --> 01:06:18,280
Speaker 1: It's and also ran to to obviously Apple's product, and

1155
01:06:18,360 --> 01:06:21,040
Speaker 1: yet they keep iterating it's like they're bull headed in

1156
01:06:21,040 --> 01:06:24,240
Speaker 1: the forward momentum. And Prime Day is coming up next month,

1157
01:06:24,560 --> 01:06:27,000
Speaker 1: and I guarantee you Amazon will discount the heck out

1158
01:06:27,000 --> 01:06:29,560
Speaker 1: of this thing. And they, you know, they've got so

1159
01:06:29,600 --> 01:06:34,760
Speaker 1: many advantages, including including controlling the retail outlet, that they

1160
01:06:34,840 --> 01:06:37,880
Speaker 1: kind of muscle their way to success. And we'll see

1161
01:06:37,920 --> 01:06:40,600
Speaker 1: if Amazon cares about the the Echo buds and another

1162
01:06:40,640 --> 01:06:43,320
Speaker 1: ten years, or even Alexa for that matter. But you're

1163
01:06:43,400 --> 01:06:46,840
Speaker 1: you're right in which it's it's not a very refined strategy, right.

1164
01:06:46,880 --> 01:06:50,440
Speaker 1: They try a lot of things. Do you remember the

1165
01:06:50,520 --> 01:06:55,120
Speaker 1: Alexa microwave? Oh god, yeah, yeah, yeah, I mean we

1166
01:06:55,160 --> 01:06:57,480
Speaker 1: haven't heard much about that, or there was an Alexa

1167
01:06:57,520 --> 01:07:00,240
Speaker 1: wall clock. Yeah, they try a lot of things. They

1168
01:07:00,360 --> 01:07:03,520
Speaker 1: orphaned some of them and they move on. Okay, talking

1169
01:07:03,520 --> 01:07:07,440
Speaker 1: about physical retail, we know from Warby Parker. You know

1170
01:07:07,480 --> 01:07:09,800
Speaker 1: a lot of people you can sell them the glasses

1171
01:07:09,840 --> 01:07:11,360
Speaker 1: by shipping to them, but a lot of people just

1172
01:07:11,400 --> 01:07:14,640
Speaker 1: want to try them on, so they open shops. How

1173
01:07:14,760 --> 01:07:17,320
Speaker 1: big a deal? I mean, first, here's the Amazon stores.

1174
01:07:17,400 --> 01:07:19,640
Speaker 1: You know, he started sort of his bookstores where they

1175
01:07:19,640 --> 01:07:24,200
Speaker 1: have hus be very little inventory, then they buy whole foods.

1176
01:07:24,240 --> 01:07:26,840
Speaker 1: Are they ever going to get this right? And you

1177
01:07:26,960 --> 01:07:30,520
Speaker 1: talk in your book about the no cashier shopping and

1178
01:07:30,560 --> 01:07:33,800
Speaker 1: all the development that took. Is there a big play

1179
01:07:33,880 --> 01:07:35,640
Speaker 1: here or are they going to play around and move

1180
01:07:35,720 --> 01:07:40,640
Speaker 1: here too. There's a massive play and they are moving here. Essentially,

1181
01:07:40,720 --> 01:07:43,920
Speaker 1: ninetent of all retail is still conducted in physical stores.

1182
01:07:44,480 --> 01:07:47,320
Speaker 1: Bezos has known that forever. He always said he wanted

1183
01:07:47,480 --> 01:07:50,560
Speaker 1: Amazon to do it. Open a store, but do something differently.

1184
01:07:51,000 --> 01:07:53,200
Speaker 1: And ten years ago they came upon this idea of

1185
01:07:53,200 --> 01:07:56,120
Speaker 1: putting cameras in the ceiling and censors in the shelves

1186
01:07:56,360 --> 01:07:59,120
Speaker 1: and automatically charging people instead of having them wait in

1187
01:07:59,120 --> 01:08:02,720
Speaker 1: front of a cashier. And they have spent hundreds of

1188
01:08:02,760 --> 01:08:04,680
Speaker 1: millions of dollars on that. It could be the most

1189
01:08:04,680 --> 01:08:08,680
Speaker 1: expensive initiative and Amazon history. And they trialed them in

1190
01:08:08,720 --> 01:08:11,240
Speaker 1: the seven eleven stores, where by the way, the sandwiches

1191
01:08:11,280 --> 01:08:15,240
Speaker 1: are got awful and and it was seemingly unsuccessful. But

1192
01:08:15,560 --> 01:08:19,120
Speaker 1: what it was was basically a technology trial, and they've

1193
01:08:19,120 --> 01:08:22,000
Speaker 1: been they've been iterating on it, and now we're seeing

1194
01:08:22,000 --> 01:08:26,960
Speaker 1: them stamp out full size Amazon Fresh supermarkets with either

1195
01:08:27,000 --> 01:08:30,160
Speaker 1: the ghost store technology, the cameras and the sensors, or

1196
01:08:30,200 --> 01:08:32,840
Speaker 1: these dash carts where it's a shopping cart that you

1197
01:08:32,960 --> 01:08:35,160
Speaker 1: roll around and as you put a product in, it

1198
01:08:35,320 --> 01:08:38,400
Speaker 1: scans it and automatically churches you. So they think they

1199
01:08:38,400 --> 01:08:41,240
Speaker 1: have a novel way to enter physical retail, and I

1200
01:08:41,280 --> 01:08:43,800
Speaker 1: suspect we're at the very earliest stages of seeing a

1201
01:08:43,920 --> 01:08:48,519
Speaker 1: massive expansion where every shopping center, every every mall, every

1202
01:08:48,560 --> 01:08:51,479
Speaker 1: retail set of retail outlets in our communities are going

1203
01:08:51,520 --> 01:08:53,920
Speaker 1: to have at least one Amazon store of some kind,

1204
01:08:54,400 --> 01:08:57,200
Speaker 1: and then Amazon can use those as kind of fulfillment nodes,

1205
01:08:57,560 --> 01:09:00,679
Speaker 1: maybe to have people order and collect packages or maybe

1206
01:09:00,720 --> 01:09:03,479
Speaker 1: even like a delivery station in the in the back,

1207
01:09:04,640 --> 01:09:08,000
Speaker 1: as well as capturing that of retail that happens in

1208
01:09:08,320 --> 01:09:10,880
Speaker 1: physical environment. So no, I don't think they're giving up.

1209
01:09:11,120 --> 01:09:13,559
Speaker 1: They haven't made a lot of progress recently, but the

1210
01:09:13,600 --> 01:09:15,719
Speaker 1: fact that we're seeing more and more of those ms

1211
01:09:15,720 --> 01:09:19,040
Speaker 1: on Fresh supermarkets tells me that we're still really at

1212
01:09:19,040 --> 01:09:22,200
Speaker 1: the beginning of this. Okay, you have the long history

1213
01:09:22,240 --> 01:09:25,479
Speaker 1: delineated in your book. I have to ask you, does

1214
01:09:25,560 --> 01:09:28,360
Speaker 1: this ghost store scanning work or they just have built

1215
01:09:28,400 --> 01:09:31,599
Speaker 1: in shrinkage because we all know at first serious the example,

1216
01:09:31,600 --> 01:09:34,360
Speaker 1: oh great concept doesn't work, but as time Alexa has

1217
01:09:34,400 --> 01:09:36,960
Speaker 1: gotten better by the same token. Can't have a conversation

1218
01:09:37,000 --> 01:09:41,040
Speaker 1: with it exactly. Yeah, No, you're right, alexis still a moron.

1219
01:09:41,400 --> 01:09:44,719
Speaker 1: And the it does seem like the tech companies always

1220
01:09:44,760 --> 01:09:48,560
Speaker 1: sort of overestimate the progress of of their AI systems,

1221
01:09:49,120 --> 01:09:52,000
Speaker 1: and and no doubt that the Ghost Store is an

1222
01:09:52,000 --> 01:09:55,760
Speaker 1: example of that, where they're they're mischarging or not understanding

1223
01:09:55,800 --> 01:09:59,519
Speaker 1: certain transactions. But instead of shrinkage, I think they've got

1224
01:10:00,080 --> 01:10:04,840
Speaker 1: create cadres of of workers, maybe contract workers, probably overseas,

1225
01:10:04,880 --> 01:10:07,920
Speaker 1: who when there's a moment of ambiguity will be reviewing

1226
01:10:07,920 --> 01:10:11,880
Speaker 1: the footage and making a manual determination. So I don't

1227
01:10:11,920 --> 01:10:13,840
Speaker 1: know the extent to which they still rely on that

1228
01:10:13,840 --> 01:10:16,920
Speaker 1: that would be a worthy focus of follow up. But

1229
01:10:17,160 --> 01:10:19,080
Speaker 1: um I do think that I I don't know there

1230
01:10:19,120 --> 01:10:22,479
Speaker 1: are employees who are concerned early on that the ghost

1231
01:10:22,520 --> 01:10:25,439
Speaker 1: Star wouldn't scale because they had these crews that had

1232
01:10:25,479 --> 01:10:29,520
Speaker 1: to monitor footage. Let's pull back the lens of the landscape.

1233
01:10:29,560 --> 01:10:32,120
Speaker 1: What do we know The guy from Quidzy ultimately went

1234
01:10:32,200 --> 01:10:37,559
Speaker 1: to Walmart during uh COVID Amazon posted amazing numbers. The

1235
01:10:37,600 --> 01:10:41,400
Speaker 1: most recent Walmart. Walmart numbers are not that good. Let's

1236
01:10:41,439 --> 01:10:44,800
Speaker 1: just talk about the business it's in, which is online retailing.

1237
01:10:45,400 --> 01:10:49,439
Speaker 1: Will anybody ever compete, certainly in in in the US

1238
01:10:49,840 --> 01:10:52,439
Speaker 1: and in parts of Europe, It's hard to imagine who

1239
01:10:52,439 --> 01:10:54,400
Speaker 1: that would be. I mean, I I do think there's

1240
01:10:54,479 --> 01:10:57,479
Speaker 1: room for competitors. I think Walmart's e commerce business has

1241
01:10:57,560 --> 01:11:00,840
Speaker 1: has been growing, as many have during the pandemic. But

1242
01:11:01,000 --> 01:11:04,600
Speaker 1: Amazon has such a tremendous headstart. eBay was so mismanaged

1243
01:11:04,640 --> 01:11:08,120
Speaker 1: for so many years that no, I I think it's hard.

1244
01:11:08,280 --> 01:11:10,599
Speaker 1: It's hard for anyone to get to that same scale.

1245
01:11:10,600 --> 01:11:14,320
Speaker 1: Now companies like Shopify are showing, you know, of carved

1246
01:11:14,320 --> 01:11:17,080
Speaker 1: out tremendous pieces of it, and Shopify might be one

1247
01:11:17,120 --> 01:11:19,280
Speaker 1: of the best success stories of the past five years

1248
01:11:19,400 --> 01:11:23,400
Speaker 1: in the technology world. But then you leave, you leave

1249
01:11:23,479 --> 01:11:26,559
Speaker 1: the US in Europe, and you do find countries where

1250
01:11:26,560 --> 01:11:30,200
Speaker 1: Amazon struggled, you know, India, it's it's run headlong into

1251
01:11:30,320 --> 01:11:33,080
Speaker 1: a local competitor, flip Card that was acquired by Walmart,

1252
01:11:33,360 --> 01:11:36,320
Speaker 1: and then Reliance Industries, which seems to have the backing

1253
01:11:36,360 --> 01:11:38,720
Speaker 1: of the of the Modi administration. And you go to

1254
01:11:38,760 --> 01:11:41,599
Speaker 1: different markets, and there's always this kind of nationalist champion.

1255
01:11:42,040 --> 01:11:44,919
Speaker 1: So I think, you know, and its oldest Marcus, Amazon

1256
01:11:45,040 --> 01:11:47,960
Speaker 1: has a little bit of a hammer lock, and you know,

1257
01:11:48,040 --> 01:11:50,280
Speaker 1: but but the world is large, and it still has

1258
01:11:50,360 --> 01:11:52,280
Speaker 1: There's a lot of countries where Amazon is not even

1259
01:11:52,320 --> 01:11:54,200
Speaker 1: in and there are a lot of countries where it's

1260
01:11:54,200 --> 01:11:57,240
Speaker 1: player number two or three. And to what degree is

1261
01:11:57,240 --> 01:12:00,120
Speaker 1: a first move or advantage in scale, and to what

1262
01:12:00,240 --> 01:12:03,679
Speaker 1: degree is it's special sauce referencing what we did before

1263
01:12:03,920 --> 01:12:06,920
Speaker 1: with Bezos and whether that's you know, dribbled down into

1264
01:12:06,920 --> 01:12:10,320
Speaker 1: the culture. Well, I mean, Amazon was very early in

1265
01:12:10,439 --> 01:12:14,880
Speaker 1: China and it lost, It lost big and lost billions

1266
01:12:14,920 --> 01:12:17,639
Speaker 1: of dollars. So I don't necessarily think it's the food.

1267
01:12:17,720 --> 01:12:22,160
Speaker 1: First mover advantage has been important all around. But I

1268
01:12:22,240 --> 01:12:25,000
Speaker 1: think you're asking, okay about the keys to Amazon success

1269
01:12:25,000 --> 01:12:31,400
Speaker 1: in general. Yeah, okay, so Amazon wasn't the first online store,

1270
01:12:31,439 --> 01:12:34,120
Speaker 1: but it was very early on. It was in large

1271
01:12:34,120 --> 01:12:36,920
Speaker 1: part pays us taking advantage of the capital environment in

1272
01:12:36,960 --> 01:12:40,120
Speaker 1: the in the late nineties and dreaming big and feeling

1273
01:12:40,200 --> 01:12:44,280
Speaker 1: like books books were just the beginning and embracing you know,

1274
01:12:44,400 --> 01:12:47,599
Speaker 1: kind of destiny. Destiny is the everything store and it

1275
01:12:47,680 --> 01:12:51,960
Speaker 1: was Yeah, it was Bezos betting big and basically sinking

1276
01:12:51,960 --> 01:12:55,520
Speaker 1: as profits into new product categories, and being willing to rethink,

1277
01:12:55,720 --> 01:13:00,519
Speaker 1: completely rethink the operations arm and creating a warehouse network

1278
01:13:00,560 --> 01:13:03,920
Speaker 1: that was tailored not for regular retail but for e commerce,

1279
01:13:03,960 --> 01:13:07,120
Speaker 1: and hiring the right people and being so public and

1280
01:13:07,280 --> 01:13:11,360
Speaker 1: bizarrely charismatic. These were all elements in the success story,

1281
01:13:11,439 --> 01:13:13,840
Speaker 1: as well as good timing and then probably just some

1282
01:13:14,000 --> 01:13:17,599
Speaker 1: luck in terms of them raising money during at the

1283
01:13:17,720 --> 01:13:19,960
Speaker 1: very beginning of the dot com bus that allowed them

1284
01:13:20,000 --> 01:13:22,960
Speaker 1: to navigate the shakeout when a lot of companies went out.

1285
01:13:23,640 --> 01:13:26,720
Speaker 1: But you know, you look at the constant reinvention of

1286
01:13:26,720 --> 01:13:31,639
Speaker 1: the company by Bezos, Aws the Kindle, Alexa, now Prime Video,

1287
01:13:32,040 --> 01:13:35,360
Speaker 1: and I think it's hard to avoid concluding that there's

1288
01:13:35,360 --> 01:13:39,040
Speaker 1: something about Bezos and his willingness to look around the

1289
01:13:39,080 --> 01:13:42,479
Speaker 1: next hill change the company, bet his winnings again on

1290
01:13:42,520 --> 01:13:47,040
Speaker 1: a new product category, reinvests his ambition, his competitiveness, his

1291
01:13:47,200 --> 01:13:50,000
Speaker 1: savv nous about technology that's been key to its success.

1292
01:13:50,880 --> 01:13:54,120
Speaker 1: Now in the music business, a truly legendary managers someone

1293
01:13:54,160 --> 01:13:57,160
Speaker 1: who does it twice. So what do we know, Bezos,

1294
01:13:57,200 --> 01:13:59,960
Speaker 1: who's built this the guy who ran the Apple Store

1295
01:14:00,080 --> 01:14:03,720
Speaker 1: for Steve Jobs, reaching success went to J. C. Penny

1296
01:14:04,000 --> 01:14:07,600
Speaker 1: couldn't do anything. If we plucked Basils out of the

1297
01:14:07,640 --> 01:14:11,080
Speaker 1: Amazon and put him in another company that was struggling,

1298
01:14:11,320 --> 01:14:13,160
Speaker 1: would he be able to reinvent it? Is he a

1299
01:14:13,240 --> 01:14:18,360
Speaker 1: wonder kind? I think he has been in terms of

1300
01:14:18,479 --> 01:14:22,680
Speaker 1: amplifying and building on Amazon's advantages. And the closest that

1301
01:14:22,720 --> 01:14:25,479
Speaker 1: I can come to that hypothetical is Bezos at at

1302
01:14:25,520 --> 01:14:30,120
Speaker 1: Blue Origin, the space company. Different company, different environment, different industry,

1303
01:14:30,439 --> 01:14:33,280
Speaker 1: different set of competitors, and I would argue he hasn't

1304
01:14:33,280 --> 01:14:36,120
Speaker 1: been very successful there. Now. In part that might be

1305
01:14:36,120 --> 01:14:38,680
Speaker 1: because it hasn't really received a lot of his focus.

1306
01:14:38,880 --> 01:14:42,120
Speaker 1: He's been funding it, but he's been managing it from afar,

1307
01:14:42,320 --> 01:14:45,479
Speaker 1: and in part I think sowing some dysfunction because of

1308
01:14:45,520 --> 01:14:47,920
Speaker 1: that choosing to who who to lead the company and

1309
01:14:47,920 --> 01:14:51,360
Speaker 1: then kind of changing leaders halfway through, viewing Elon Musk

1310
01:14:51,360 --> 01:14:55,320
Speaker 1: competitively and then amplifying his ambitions. So maybe it's a

1311
01:14:55,320 --> 01:14:57,920
Speaker 1: poor example, but I think it's a way of saying

1312
01:14:57,960 --> 01:15:01,720
Speaker 1: that the magic isn't as in broadly applicable that in

1313
01:15:01,840 --> 01:15:04,920
Speaker 1: Space and with Blue Origin, he hasn't succeeded in the

1314
01:15:04,960 --> 01:15:08,040
Speaker 1: same way and at least the way you might think now.

1315
01:15:08,080 --> 01:15:11,160
Speaker 1: At the Washington Post, he took over a paper and

1316
01:15:11,280 --> 01:15:15,040
Speaker 1: decline and he really revived its fortune. So yeah, I

1317
01:15:15,360 --> 01:15:18,439
Speaker 1: think there's probably something that's broadly applicable about the Bezos

1318
01:15:18,479 --> 01:15:22,320
Speaker 1: management style. But the guy has spread very thin now,

1319
01:15:22,800 --> 01:15:25,479
Speaker 1: and I don't think he's given the care and attention

1320
01:15:25,479 --> 01:15:28,920
Speaker 1: to blue origin that it's required. Okay, you've been following

1321
01:15:28,960 --> 01:15:31,720
Speaker 1: the landscape for decades here, so what do we know?

1322
01:15:31,920 --> 01:15:35,960
Speaker 1: Twenty years ago is all about hardware? Today it's about software.

1323
01:15:36,560 --> 01:15:39,680
Speaker 1: Up until about ten years ago, every month, if not

1324
01:15:39,760 --> 01:15:42,360
Speaker 1: more frequently, there was a new product, whether it be

1325
01:15:42,479 --> 01:15:46,240
Speaker 1: hardware software. That is not the case. We've had consolidation

1326
01:15:46,560 --> 01:15:50,479
Speaker 1: such we have the Amazon, Google, Facebook, and Apple. Maybe

1327
01:15:50,479 --> 01:15:54,839
Speaker 1: you can throw Microsoft in there. Being this here, where's

1328
01:15:54,880 --> 01:15:58,200
Speaker 1: this all going? I think we're living in an age

1329
01:15:58,200 --> 01:16:02,800
Speaker 1: of oligopoly. I think at it's hard to evaluate these

1330
01:16:02,840 --> 01:16:07,439
Speaker 1: companies alone. They you know, they they compete with each

1331
01:16:07,479 --> 01:16:10,320
Speaker 1: other really not even on the margins, but in significant

1332
01:16:10,320 --> 01:16:15,160
Speaker 1: business categories and um they you know, because of their

1333
01:16:15,200 --> 01:16:18,200
Speaker 1: their fierce competition with each other, you know, they they're

1334
01:16:18,240 --> 01:16:21,720
Speaker 1: they're moving quickly, They're they're in competition for the best engineers.

1335
01:16:22,000 --> 01:16:26,360
Speaker 1: They're throwing elbows. I worry that it's blotting out a

1336
01:16:26,400 --> 01:16:31,559
Speaker 1: lot of the opportunity and entrepreneurial opportunity. Um that's that's

1337
01:16:31,600 --> 01:16:35,160
Speaker 1: been so historic to America's success in the vibrancy of

1338
01:16:35,160 --> 01:16:39,200
Speaker 1: Silicon Valley. So you know, it's we're entering a really

1339
01:16:39,240 --> 01:16:42,479
Speaker 1: interesting period where we have a presidential administration now that's

1340
01:16:42,479 --> 01:16:45,439
Speaker 1: committed to reviewing the conduct of these companies. I think

1341
01:16:45,439 --> 01:16:49,639
Speaker 1: we're gonna see a lot more high profile antitrust lawsuits

1342
01:16:49,680 --> 01:16:52,599
Speaker 1: against the big tech companies. It'll be interesting to see

1343
01:16:52,680 --> 01:16:55,200
Speaker 1: the government to grapple with their complexity. And it's all,

1344
01:16:55,320 --> 01:16:58,960
Speaker 1: of course so fast moving, and these legal processes stretch

1345
01:16:59,040 --> 01:17:01,840
Speaker 1: out over many years. Is and these companies change every

1346
01:17:01,880 --> 01:17:04,719
Speaker 1: every year. So I don't know, I mean, I think

1347
01:17:04,760 --> 01:17:08,200
Speaker 1: I think it'll it'll be it'll be interesting to watch.

1348
01:17:08,479 --> 01:17:11,200
Speaker 1: But I see, you know, these big tech companies in

1349
01:17:11,320 --> 01:17:15,000
Speaker 1: you know, continuing to grow and in some ways probably

1350
01:17:15,040 --> 01:17:18,400
Speaker 1: sapping some of the vibrancy from the economy and some

1351
01:17:18,439 --> 01:17:22,080
Speaker 1: of the opportunity for other companies. Now we talk is

1352
01:17:22,080 --> 01:17:24,760
Speaker 1: the Internet mature. What I mean by that is if

1353
01:17:24,760 --> 01:17:28,360
Speaker 1: you can look at certain things I'm a big skier, music, etcetera.

1354
01:17:28,680 --> 01:17:31,400
Speaker 1: There's an element, there's a craziness when it develops and

1355
01:17:31,439 --> 01:17:34,639
Speaker 1: then you have a business, but it's relatively regimented and managed.

1356
01:17:35,040 --> 01:17:37,839
Speaker 1: You talk to other people and they'll say the power

1357
01:17:37,880 --> 01:17:40,240
Speaker 1: of the smartphone is so strong computer in your hand

1358
01:17:40,600 --> 01:17:45,360
Speaker 1: that the runway is incredibly long. So what's your viewpoint

1359
01:17:45,640 --> 01:17:48,680
Speaker 1: and what might we see on the horizon technically or

1360
01:17:48,680 --> 01:17:53,679
Speaker 1: with the Internet. I think it's probably the wrong move

1361
01:17:53,760 --> 01:17:56,680
Speaker 1: to pad against the Internet, right it's I mean, just

1362
01:17:56,800 --> 01:18:00,200
Speaker 1: in my professional career, I've seen the thing explain what

1363
01:18:00,320 --> 01:18:04,000
Speaker 1: over over twenty five years and showed no signs of

1364
01:18:04,280 --> 01:18:07,800
Speaker 1: slowing down. It does always seem like new kind of

1365
01:18:07,840 --> 01:18:12,240
Speaker 1: transitions or new technologies are around the corner. The smartphone

1366
01:18:12,240 --> 01:18:16,719
Speaker 1: gave us, you know, almost ten years of of runway.

1367
01:18:16,960 --> 01:18:19,280
Speaker 1: My last book was about Uber and Airbnb and how

1368
01:18:19,320 --> 01:18:24,639
Speaker 1: they basically built their businesses on on the smartphone. Um.

1369
01:18:24,800 --> 01:18:28,400
Speaker 1: The fact is people are spending more time on their devices,

1370
01:18:28,439 --> 01:18:31,519
Speaker 1: on their computers, interacting with the world. You know. Cloud

1371
01:18:31,520 --> 01:18:35,400
Speaker 1: computing feels like a change, a revolution in its infancy. Still,

1372
01:18:35,720 --> 01:18:38,760
Speaker 1: so I don't I don't see any reasons to think

1373
01:18:38,760 --> 01:18:42,439
Speaker 1: that anything any anything any of our the slow creep

1374
01:18:42,479 --> 01:18:47,719
Speaker 1: into UH technological society is slowing down. Okay, then drilling

1375
01:18:47,760 --> 01:18:50,320
Speaker 1: down a little bit more to your work directly. You

1376
01:18:50,400 --> 01:18:54,599
Speaker 1: work for Bloomberg, and what do we know? A lot

1377
01:18:54,640 --> 01:18:57,280
Speaker 1: of media companies have been hurt by the lack of

1378
01:18:57,360 --> 01:19:02,639
Speaker 1: advertising of during COVID. Bloomberg makes most of its money

1379
01:19:02,760 --> 01:19:08,439
Speaker 1: from its UH quote machines and information machines that brokers use.

1380
01:19:09,120 --> 01:19:12,160
Speaker 1: Bloomberg was a three sixty degree news company, then they

1381
01:19:12,200 --> 01:19:17,320
Speaker 1: refocus it to business. Bloomberg will last. But being in

1382
01:19:17,360 --> 01:19:22,040
Speaker 1: this publishing news industry, and I'll make it pretty broad.

1383
01:19:22,960 --> 01:19:27,639
Speaker 1: Our physical magazines going to survive? Is there a hope

1384
01:19:27,640 --> 01:19:30,800
Speaker 1: for local newspapers? I'm not asking for you to be optimistic,

1385
01:19:31,439 --> 01:19:34,160
Speaker 1: but where is it going? There? Are we going towards

1386
01:19:34,160 --> 01:19:38,640
Speaker 1: a winner take all landscape in news too. I'm extremely

1387
01:19:38,680 --> 01:19:42,040
Speaker 1: concerned about the health and the future of local newspapers.

1388
01:19:42,439 --> 01:19:44,600
Speaker 1: I'm from Cleveland, Ohio, and I grew up reading the

1389
01:19:44,600 --> 01:19:47,600
Speaker 1: Cleveland Plane Dealer and it's where I really got my

1390
01:19:47,680 --> 01:19:51,080
Speaker 1: interest in news. That and reading Newsweek magazine actually, which

1391
01:19:51,120 --> 01:19:54,160
Speaker 1: ended up being my first employer. And you know, recently

1392
01:19:54,280 --> 01:19:56,800
Speaker 1: the sale of the of the Tribune Company assets to

1393
01:19:57,200 --> 01:20:01,480
Speaker 1: private equity, and just the deteriorating health of local newspapers

1394
01:20:01,479 --> 01:20:04,680
Speaker 1: and media outlets and how that's ended up polluting the

1395
01:20:04,720 --> 01:20:08,840
Speaker 1: democratic process. It's really worrisome and I don't see, really

1396
01:20:09,200 --> 01:20:11,760
Speaker 1: it's hard to be optimistic about that, you want. I mean,

1397
01:20:11,920 --> 01:20:14,960
Speaker 1: what Basos has done with the Washington Post has been remarkable,

1398
01:20:15,240 --> 01:20:17,320
Speaker 1: and it would be great to see him or a

1399
01:20:17,320 --> 01:20:21,040
Speaker 1: billionaire like him, pursue a kind of Carnegie like philanthropy.

1400
01:20:21,400 --> 01:20:24,360
Speaker 1: You know what Carnegie did with the libraries? Was it?

1401
01:20:24,360 --> 01:20:27,320
Speaker 1: It was Carnegie? I guess it was Okay, great, I'm

1402
01:20:27,360 --> 01:20:30,160
Speaker 1: not embarrassing myself with my history there uh to to

1403
01:20:30,280 --> 01:20:34,040
Speaker 1: do something like that for local newspapers. And unfortunately that

1404
01:20:34,040 --> 01:20:37,800
Speaker 1: that billionaire philanthropist is not has not made him or

1405
01:20:37,840 --> 01:20:42,280
Speaker 1: herself known yet. And meanwhile newspapers are languishing, the business

1406
01:20:42,360 --> 01:20:46,080
Speaker 1: model is deteriorated, and the democratic process I think has

1407
01:20:46,120 --> 01:20:49,479
Speaker 1: been polluted because of that. As for magazines, you know,

1408
01:20:49,640 --> 01:20:52,120
Speaker 1: we're we're still I think, and now the second or

1409
01:20:52,160 --> 01:20:55,519
Speaker 1: third decade of a slow transition, and properly, these properties

1410
01:20:55,560 --> 01:20:58,000
Speaker 1: have to become digital and they have to build events,

1411
01:20:58,040 --> 01:21:02,400
Speaker 1: businesses and create new relationships with there. There they're subscribers

1412
01:21:02,400 --> 01:21:05,240
Speaker 1: and I think we've seen there have been remarkable examples

1413
01:21:05,280 --> 01:21:07,720
Speaker 1: of magazines. I'm gonna just gonna pick one The Atlantic

1414
01:21:08,000 --> 01:21:11,240
Speaker 1: that I think it's really successfully made the transition. Business

1415
01:21:11,320 --> 01:21:13,639
Speaker 1: Week I think is another good example. It's now inside

1416
01:21:13,680 --> 01:21:17,840
Speaker 1: the Bloomberg empire. It nourishes what we do at Bloomberg

1417
01:21:17,840 --> 01:21:21,200
Speaker 1: in so many different ways. But it's still a time

1418
01:21:21,200 --> 01:21:24,439
Speaker 1: of transition. And the old the the the physical ads

1419
01:21:24,479 --> 01:21:27,519
Speaker 1: and the actual subscriptions. Of course, you know, the analog

1420
01:21:27,600 --> 01:21:31,120
Speaker 1: print subscriptions, as you would expect, have continued to deteriorate.

1421
01:21:31,400 --> 01:21:33,880
Speaker 1: That's not changing soon. So the magazines that are going

1422
01:21:33,920 --> 01:21:35,840
Speaker 1: to survive are going to have to really complete their

1423
01:21:35,880 --> 01:21:40,880
Speaker 1: their transition. I've written two books on Amazon. What is

1424
01:21:40,920 --> 01:21:43,880
Speaker 1: your personal focus? What is the subject that you're putting

1425
01:21:43,920 --> 01:21:47,000
Speaker 1: paying attention to going forward? I mean, right now, Bob,

1426
01:21:47,040 --> 01:21:52,639
Speaker 1: I'm still locked in the Amazon jail. The book came out, Um,

1427
01:21:52,800 --> 01:21:57,599
Speaker 1: you know I'm talking about it. I I don't actually

1428
01:21:57,640 --> 01:21:59,280
Speaker 1: see the light at the end of the tunnel in

1429
01:21:59,400 --> 01:22:01,600
Speaker 1: terms of I mean, the challenge of the Amazon is

1430
01:22:01,640 --> 01:22:04,320
Speaker 1: they make news every single day or every single week,

1431
01:22:04,400 --> 01:22:07,799
Speaker 1: and you know it's it's MGM or it's a shareholder meeting.

1432
01:22:07,960 --> 01:22:11,200
Speaker 1: Or it's something with the workplace or Bezos news, and

1433
01:22:11,280 --> 01:22:13,479
Speaker 1: so there there is a near future for me of

1434
01:22:13,479 --> 01:22:17,479
Speaker 1: continuing to to blab about Amazon and my books. But

1435
01:22:17,600 --> 01:22:20,160
Speaker 1: longer term, I run a tech team at Bloomberg. It's

1436
01:22:20,200 --> 01:22:22,960
Speaker 1: I'm extraordinarily proud of it. It's you know, we cover

1437
01:22:23,000 --> 01:22:26,120
Speaker 1: all the big tech companies and investors and trends, and

1438
01:22:26,160 --> 01:22:28,240
Speaker 1: so that gives me a great purview to kind of

1439
01:22:28,280 --> 01:22:31,639
Speaker 1: see all these changes in our society and our business

1440
01:22:31,760 --> 01:22:34,280
Speaker 1: landscape and try to find the stories I'm interested in.

1441
01:22:34,439 --> 01:22:36,920
Speaker 1: I have no idea what that is next. I have

1442
01:22:36,960 --> 01:22:39,360
Speaker 1: to kind of lick my wounds from from this ordeal

1443
01:22:39,840 --> 01:22:43,080
Speaker 1: and then hopefully I'll find something that interests me. Thanks

1444
01:22:43,080 --> 01:22:46,040
Speaker 1: so much, Brad. This has really been great. Thanks for

1445
01:22:46,080 --> 01:22:48,720
Speaker 1: taking the time to tell the story, Bob, It's been

1446
01:22:48,720 --> 01:22:51,080
Speaker 1: a pleasure. I also want to say for people, these

1447
01:22:51,120 --> 01:22:54,559
Speaker 1: are easily read books. They're written as stories. These are

1448
01:22:54,600 --> 01:22:57,960
Speaker 1: not hardcore business books where your eyes rolled back into

1449
01:22:58,000 --> 01:23:00,919
Speaker 1: your head. And if you want to know what Amazon

1450
01:23:01,040 --> 01:23:03,759
Speaker 1: is doing, Brad literally is the guy in these books?

1451
01:23:03,760 --> 01:23:06,559
Speaker 1: Are the definitive statements. I just want to emphasize that's

1452
01:23:06,600 --> 01:23:08,639
Speaker 1: not a hype. I've certainly read both of them. That's

1453
01:23:08,640 --> 01:23:12,040
Speaker 1: why I wanted Brad on the podcast. Until next time.

1454
01:23:12,280 --> 01:23:13,479
Speaker 1: This is Bob Blessed sex