Amazon.com founder and CEO Jeff Bezos didn't seem too attentive in the "Top Ten Lessons Learned in E-Commerce" panel earlier today at the South by Southwest conference in Austin. While Zappos.com CEO Tony Hsieh presented his ten lessons — "don't compete on price" and "don't worry about competitors" among them — Bezos spent most of the time on his BlackBerry. Captions in the comments, please.
Jeff Bezos likes to say he's in the business of delighting customers. And then he delivers that howling, hooting laugh. The latest guffaw-provoker: Amazon EC2, a service which lets startups run their programs on servers housed in Amazon.com's datacenters. When it launched, Amazon promised "the equivalent of a 1.7GHz x86 processor" — in other words, a fairly low-powered server, but at the cost of a dime an hour. Ted Dziuba, the acid-tongued former editor of Uncov, found that Amazon actually delivered half that performance. Why haven't you heard more about this? Likely because most of the me-too, slapdash websites making use of Amazon's EC2 aren't running anything more processor-intensive than an index-hit SQL select.
For the first time since 2004, Jeff Bezos has sold shares of Amazon.com. His $135 million sale brings his holdings down to a mere 99 million. In total, Bezos and other insiders have sold nearly 2 million shares of Amazon.com in just a few weeks. Profit-taking, since the stock is riding high? Or do they know something about Kindle sales that they haven't told us yet?
The departure of Brian Valentine, a 19-year Microsoft veteran before he left in 2006, has always been a bit of a puzzle. In August of that year, Microsoft management told his staff he was taking a new job within the company after shipping Windows Vista. A month later, he left for Amazon.com. Now, Amazon.com has cleared things up with a belated SEC filing: Microsoft lied to its employees. Here's the timetable:
Wired has resurrected an old tradition: Get the geeks in the server room to explain why computers fail. This time, it's CondeNet CTO Rajiv Pant, explaining why Wired uses Amazon's S3 storage service despite this morning's breakdown. But last time around? Breaking down walls between the engineering quad and the newsroom resulted in ... Paul Boutin. Don't say you weren't warned.
Sales clerks at a number of TV retailers in Massachusetts gave inaccurate information regarding the upcoming analog-to-digital television conversion. Imagine that: Sales clerks giving inaccurate information! The switch will require users of older televisions to purchase a basic set-top box partially subsidized by the government, but does not require viewers to buy a new TV. Eric Bourassa, a consumer advocate with MassPIRG, which commissioned the study, says "retailers should do a better job training their staff so that going forward, consumers that go into the stores can get the right information."
Amazon's S3 Web-storage service, favored by startups too poor to afford their own hard drives or too technically inept to set them up, went down for about two hours earlier today, slowing down graphics on services like Twitter and Tumblr, SAI reports. "Not a big deal," Tumblr founder David Karp told us. "A reminder for a lot of services that redundancy beyond Amazon is still necessary," he said. Maybe not for you, David. But I'm lost without my morning dose of Nevver.
When Jeff Bezos and company reported Amazon.com's earnings at the end of last quarter, they swore the Kindle was flying off the shelves. But I've never seen one in the wild. Or even heard of a sighting. Until today when I saw, thanks to Silicon Alley Insider, a photo of a girl reading a Kindle on the New York subway. Take that, Kindle-hater Steve Jobs. Have you ever seen anyone using a Newton on the subway?
Arthur Klebanoff, CEO of e-book publisher RosettaBooks, says Kindle-compatible e-books will not outsell Sony Reader-compatible books published by his house in 2008. This despite the fact that Amazon.com execs told analysts Kindle sales were "outpacing our expectations" — and Amazon appears to be skewing search results on the site in Kindle's favor.
Amazon.com's search engine, A9, was an utter flop. But now it has entered the profitable side of the search engine business with Amazon Product Ads. The new ads direct customers to third-party sites on a cost-per-click basis. Which is how Google makes all its money, too. Except that Amazon's audience is almost entirely shoppers, while Google has a large cohort searching for Linux drivers. Here's Amazon's product pitch, from an email it blasted out to potential advertisers.
For years, retailers have given preferential shelf space to certain products — sometimes because they are higher margin, or because the manufacturer has paid for that placement. Should Amazon.com be any different? During the holiday season, the online retailer listed its Kindle e-reader at the very top in search results for "sony reader." Clever! Even better, a search for "kindle" doesn't mention its Sony competitor at all. My personal favorite? A number of customers have tagged the Kindle with "sony reader." That's what loser-generated content gives you, I guess.
Under Jeff Bezos, Amazon has ever played the chameleon, morphing from bookstore to discounter to supermarket. Most recently, it's tried, through the guise of its Amazon Web Services arm, to get people to think of it as a supercomputer to rent. Amazon's earnings were financially solid: The company raked in $1.4 billion in operating cash flow, and by more conventional measures, it earned $207 million on $5.7 billion in revenues. You won't read about that in the blogs, though, because Amazon earned that money the old-fashioned way — by shipping books and other physical goods to customers.
What's the value of the spoken word? $300 million, according to Amazon.com, which just purchased the leading digital audiobook reseller, Audible.com. The amount is a premium of more than 20 percent on yesterday's closing price. The purchase of Audible, which just celebrated its 10th anniversary, shows that Amazon is serious about digital content. Amazon has sold Audible's audio downloads since May 2000, and the purchase is a natural fit as Amazon offers more content via digital delivery. But what does it mean for the consumer?
Amazon.com doubled its profit last quarter as sales increased to $5.7 billion, up 42 percent. Books, movies and music revenue rose 33 percent — still the core of Amazon's business — while electronics and other merchandise jumped 58 percent. Amazon expects sales to grow between 31 and 38 percent in the current quarter. [WSJ]
On Friday, Citigroup's Mark Mahaney judged tech stocks on four criteria: International exposure, countercyclical hedges, least risk to 2008 Wall Street estimates and intrinsic valuation. Which means what? Dunno. Go to Seeking Alpha for that. But to find out if your company's on the OK or Not-So-OK list in light of this morning's Fed rate cut and stock-market dive, check out this list.
Los Angeles-based Withoutabox, a membership site which allows independent filmmakers to submit their work to movie festivals, has been acquired by Amazon.com subsidiary IMDB, the company told customers in an email today. David Straus and Joe Neulight founded the company in 2000 and saw it become popular among film-school students and film-festival producers. A niche audience, to be sure: Compete.com puts the site's "people count" in December 2007 at 22,888. But we suspect that Amazon bought the site not for its eyeballs, but for content it can sell directly to its huge audience of shoppers, bypassing Hollywood. Straight from Withoutabox to Amazon Unbox, in other words. Anyone know how much Amazon paid?
Remember the comparisons between Amazon's Kindle and the iPod? Don't try them on Apple CEO Steve Jobs. The Kindle was a bad idea, Jobs told the New York Times after yesterday's Macworld keynote. "It doesn't matter how good or bad the product is, the fact is that people don't read anymore," he said. "Forty percent of the people in the U.S. read one book or less last year. The whole conception is flawed at the top because people don't read anymore." Mmhmm, Mr. Jobs. And whose fault is that?
For the first holiday season ever, more Americans visited Amazon.com than eBay last December, the New York Times reports, citing numbers from Nielsen. eBay still trumped Amazon in time spent, or "engagement," and total pageviews — all of that auction-watching, you know. And it's important to remember that traffic without transactions doesn't do either site any good. But the news can't be a comfort the eBay CEO Meg Whitman, here pictured with Mitt Romney (far left) and some guy.
Amazon will pay the equivalent of $1,500 per day in fines and continue to offer free shipping in France in defiance of a recently imposed court order. The high-minded and socialist-leaning French government passed the 1981 Lang law, which prevents selling books at a discount, to protect small booksellers from the predation of discount supermarkets. How visionary those legislators were to anticipate the coming of Amazon. Hoping to overturn the law, Bezos is trying to muster the support of French cheap-book lovers. But Amazon is unlikely to prevail even with the people's support. The High Court of Versailles is unlikely to appreciate the online book retailer's sense of revolution. Off with their savings!
Valleywag has learned that Amazon.com has invested $4 million in sale-a-day e-commerce site Woot. The deal gives Amazon right of first refusal to buy the company should Woot hit certain unnamed sales targets, want to go public, or sell to another company. For the most part, the companies operate independently. But there's more to Woot, and its ties to Amazon, than meets the eye.
