Who knew the key to wealth was to build a trillion dollar bookstore. Seriously, an enormous platform where you can buy almost anything; fidget spinners, couches, your ex-wife (I said almost anything). It's a huge responsibility to manage that, wouldn't you think? Who cares, it's Andy Jassy's job now. Hopefully he doesn't run it to the ground. Unless it's headed there anyway? Is Bezos washing his hands from these three main problems at Amazon?
Haters Gonna Hate
Regulators around the globe have Amazon under a magnifying glass when it comes to their business practices, more so in the way it looks at information from businesses that sell goods on its site and uses it to create its own Amazon-branded products. Bezos actually said at a hearing before congress last summer that even though Amazon had a policy preventing employees from accessing seller data, he couldn't guarantee that the policy wasn't being violated.
For tech giants, the world was sunshine and rainbows - in benefit to the light regulation that has been going on for decades. However, growing concerns for these tech nerds has called for action as the nation demands scrutiny and punishment. The U.S. government has already rang on Facebook and Google's doorbell with antitrust lawsuits.
A report by the House Judiciary Committee in October called for a possible breakup of Amazon and others, making it harder for them to swallow the small fish, or acquire small businesses and impose new rules to safeguard competition.
Treating Their Workers Like Dog$#!+
The Coronavirus has shined a spotlight on companies to see how they handle these situations (not like an unprecedented pandemic could have been accounted for, but whatever) and whether or not they can survive. In this case, Amazon and big tech excelled. Unfortunately, they're assholes. The pandemic also exposed how Amazon treats its workers who pack and ship boxes in the warehouse. Many have complained and protested over the lack of protective equipment, such as masks. Many have also said the company isn't forthcoming with the number of people getting sick.
Amazon has made changes since, but their issues go way beyond what this pandemic exposed. At a warehouse in Alabama, workers are set to start voting this month if they want to join a union. Regulators have their eyes peeled. On Tuesday, the same day Bezos said he would step down, the U.S. Federal Trade Commission ordered Amazon to pay almost $62 million for taking tips that were supposed to go to its delivery drivers. There's a special place in hell for people like this. Amazon is the second-largest private employer, just behind Walmart. Maybe Bezos would rather sit this one out, which means Andy has his work cut out for him.
Growing The Cloud
The moneymaker is in the tech. Amazon Web Services is the number one provider of cloud computing services, but still faces fierce competition from Microsoft, which has aggressively sought to sell big time contracts to business and governments. In 2019, Amazon lost a multi-billion dollar contract with the U.S. government to Microsoft. Amazon is still trying to win it in court.
Jassy comes from Amazon Web Services, his specialty. This may be a move that indicates what Amazon really cares about, and where they see their future headed. Last year, about 60% of their total profits came from their web service. Like we mentioned earlier, it's going to be hard for Amazon to do anything because of the hard pressed regulatory scrutiny they would face. Their opportunities in the cloud computing are sky high.
Hounder Media Newsletter
Join the newsletter to receive the latest updates in your inbox.