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* {{cite web|url=http://www.seattlepi.com/business/158315_amazon28.html|title=How Amazon.com survived, thrived and turned a profit|date=2004-01-28|author=Christine Frey & John Cook|publisher=seattlepi.com}}
* {{cite web|url=http://www.seattlepi.com/business/158315_amazon28.html|title=How Amazon.com survived, thrived and turned a profit|date=2004-01-28|author=Christine Frey & John Cook|publisher=seattlepi.com}}
* [http://www.gatagat.com/amazon-kindle-fire-amazon-launched-kindle-fire-new-kindle-tablet/ Amazon.com Unveil New Kindle Tablet “Kindle Fire”]


{{Amazon|state=expanded}}
{{Amazon|state=expanded}}

Revision as of 02:23, 27 September 2011

Amazon.com, Inc.
Type of businessPublic
Type of site
E-commerce
Available inEnglish, Japanese, German, French, Brazilian Portuguese, Italian & Chinese, Spanish
Traded asNasdaq: AMZN
NASDAQ-100 Component
S&P 500 Component
Founded1994
HeadquartersSeattle, Washington, U.S.
Area servedWorldwide
Founder(s)Jeff Bezos
Key peopleJeff Bezos
(Chairman, President & CEO)
IndustryOnline shopping
Cloud computing
ProductsAmazon.com
Zappos
Amazon Studios
Amazon Web Services
A2Z Development
A9.com
Alexa Internet
Audible.com
Endless.com
IMDb
Kindle
Lovefilm
Woot
RevenueIncrease US$ 34.204 billion (2010)[1]
Operating incomeIncrease US$ 1.406 billion (2010)[1]
Net incomeIncrease US$ 1.152 billion (2010)[1]
Total assetsIncrease US$ 18.797 billion (2010)[1]
Total equityIncrease US$ 6.864 billion (2010)[1]
Employees33,700 (2010)[1]
URLamazon.com
AdvertisingWeb banners
Videos
Launched1995

Amazon.com, Inc. (Nasdaq: AMZN) is a US-based multinational electronic commerce company. Headquartered in Seattle, Washington, it is often called the world's largest online retailer.[3] Amazon has websites and delivery for the following countries: United States, Canada, United Kingdom, Germany, France, Italy, Spain, Austria, Japan, and China. Launches in Netherlands, Sweden, and India may follow.[4] It also provides international shipping to certain countries for some of its products.

Jeff Bezos founded Amazon.com, Inc. in 1994 and the site went online in 1995.[5] It is named after the Amazon River, one of the largest rivers in the world.[5] Amazon.com started as an online bookstore, but soon diversified, selling DVDs, CDs, MP3 downloads, computer software, video games, electronics, apparel, furniture, food, and toys.

History

Jeff Bezos, the founder of Amazon.com

Amazon was founded in 1995,[6] spurred by what Bezos called "regret minimization framework", his effort to fend off regret for not staking a claim in the Internet gold rush.[7] Company lore says Bezos wrote the business plan while he and his wife drove from New York to Seattle,[8] although that account is disputed. Bezos flew from New York to Texas, where he picked up a car from a family member, and then drove from Texas to Seattle.

The company began as an online bookstore;[9] while the largest brick-and-mortar bookstores and mail-order catalogs for books might offer 200,000 titles, an online bookstore could offer more. Bezos wanted a name for his company that began with "A" so that it would appear first in lists, like in phone books.[5] He began looking through the dictionary and settled on "Amazon" because it was a place that was "exotic and different" and the river he considered the biggest in the world, like he hoped his company would be.[5] Since 2000, Amazon's logotype is an arrow leading from A to Z, representing customer satisfaction (as it forms a smile); a goal was to have every product in the alphabet.[10]

Amazon was incorporated in 1994, in the state of Washington. In July 1995, the company began service and sold its first book on amazon.com - Douglas Hofstadter's Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought.[11] In 1996, it was reincorporated in Delaware. Amazon issued its initial public offering of stock on May 15, 1997, trading under the NASDAQ stock exchange symbol AMZN, at an IPO price of US$18.00 per share ($1.50 after three stock splits in the late 1990s).

Amazon's initial business plan was unusual: the company did not expect a profit for four to five years. Its "slow" growth provoked stockholder complaints that the company was not reaching profitability fast enough. When the dot-com bubble burst, and many e-companies went out of business, Amazon persevered, and finally turned its first profit in the fourth quarter of 2001: $5 million or 1¢ per share, on revenues of more than $1 billion, but the modest profit was important in demonstrating the business model could be profitable. In 1999, Time magazine named Bezos Person of the Year, recognizing the company's success in popularizing online shopping.

Barnes and Noble filed a lawsuit on 12 May 1997, alleging that Amazon's claim to be "The world's largest bookstore" was false. They asserted "[It] isn't a bookstore at all. It's a book broker." The suit was later settled out of court. Amazon continued to call itself "The world's largest bookstore."[12] This was followed by Walmart filing suit on 16 October 1998, alleging that Amazon had stolen trade secrets by hiring former Walmart executives. Although this suit was settled out of court, it led to work restrictions and reassignment of the former Walmart executives.[12]


Acquisitions

Investments

Subsidiaries

  • 2004: A9.com, a company focused on researching and building innovative technology.[41]
  • 2004: Lab126, developers of integrated consumer electronics such as the Kindle.
  • 2007: Endless.com, an e-commerce brand focusing on shoes.[42]

Merchant partnerships

The website CDNOW is managed by Amazon. Until June 30, 2006, typing ToysRUs.com into a browser would similarly bring up Amazon.com's "Toys & Games" tab; however, this relationship was terminated due to a lawsuit.[43] Amazon also hosted and managed the website for Borders bookstores but this ceased in 2008.[44] From its inception until August 2011, Amazon hosted the retail website for Target.[45]

Amazon.com powers and operates retail web sites for Sears Canada, Benefit Cosmetics, bebe Stores, Timex, Marks & Spencer, Mothercare, and Lacoste. For a growing number of enterprise clients, currently including the UK merchants Marks & Spencer, Benefit Cosmetics' UK entity, edeals.com, and Mothercare, Amazon provides a unified multichannel platform where a customer can seamlessly interact with some people that they call the retail website, standalone in-store terminals, or phone-based customer service agents. Amazon Web Services also powers AOL's Shop@AOL.

Locations

Amazon.com has offices, fulfillment centers, customer service centers and software development centers across North America, Latin America, Europe and Asia.[46]

Headquarters

amazon.com's former headquarters in the former U.S. Public Health Hospital (Merchant Marine & Indians) in Beacon Hill, Seattle.

The company's global headquarters are located in Seattle's South Lake Union neighborhood.

Software development centers

The company employs software developers in centers across the globe. While much of Amazon's software development is in Seattle, other locations include Slough (England) and Edinburgh (Scotland), Dublin (Ireland), Bangalore, Chennai, and Hyderabad (India), Cape Town (South Africa), Iaşi (Romania), Shibuya, Tokyo (Japan), Beijing (China), Orange County (United States), and San Francisco (United States).

Fulfillment and warehousing

Fulfillment centers are located in the following cities, often near airports. These centers also provide warehousing and order-fulfillment for third-party sellers:[47]

  • North America:
  • Europe:
Amazon.co.uk warehouse, Glenrothes.
  • Asia:

Closed fulfillment and warehousing locations

These U.S. distribution centers have been closed: Red Rock, Nevada; Chambersburg, Pennsylvania; Munster, Indiana; and McDonough, Georgia. [56][57][58]

Products and services

Third-generation Amazon Kindle

Amazon product lines include books, music CDs, videotapes and DVDs, software, consumer electronics, kitchen items, tools, lawn and garden items, toys & games, baby products, apparel, sporting goods, gourmet food, jewelry, watches, health and personal-care items, beauty products, musical instruments, clothing, industrial & scientific supplies, and groceries.

The company launched amazon.com Auctions, a Web auctions service, in March 1999. However, it failed to chip away at industry pioneer eBay's large market share. amazon.com Auctions was followed by the launch of a fixed-price marketplace business, zShops, in September 1999, and the now defunct Sotheby's/Amazon partnership called amazon.com in November. Auctions and zShops evolved into Amazon Marketplace, a service launched in November 2000 that let customers sell used books, CDs, DVDs, and other products alongside new items. Today, Amazon Marketplace's main rival is eBay's Half.com service.

In August 2005,[59] Amazon began selling products under its own private label, "Pinzon"; the trademark applications indicated that the label would be used for textiles, kitchen utensils, and other household goods.[59] In March 2007, the company applied to expand the trademark to cover a more diverse list of goods, and to register a new design consisting of the "word PINZON in stylized letters with a notched letter O whose space appears at the "one o'clock" position".[60] Coverage by the trademark grew to include items such as paints, carpets, wallpaper, hair accessories, clothing, footwear, headgear, cleaning products, and jewelry.[60] On September 2008, Amazon filed to have the name registered. USPTO has finished its review of the application, but Amazon has yet to receive an official registration for the name.

Amazon MP3, its own online music store, launched in the US on September 25, 2007, selling downloads exclusively in MP3 format without digital rights management.[61] This was the first online offering of DRM-free music from all four major record companies.[62][63][64][65]

In August 2007, Amazon announced AmazonFresh,[66] a grocery service offering perishable and nonperishable foods. Customers can have orders delivered to their homes at dawn or during a specified daytime window. Delivery was initially restricted to residents of Mercer Island, Washington, and was later expanded to several ZIP codes in Seattle proper.[67] AmazonFresh also operated pick-up locations in the suburbs of Bellevue and Kirkland from summer 2007 through early 2008.

In 2008 Amazon expanded into film production, producing the film The Stolen Child with 20th Century Fox.[68]

Amazon's Honor System was launched in 2001 to allow customers to make donations or buy digital content, with Amazon collecting a percentage of the payment plus a fee. The service was discontinued in 2008.[69] and replaced by Amazon Payments. Amazon launched Amazon Web Services (AWS) in 2002, which provides programmatic access to latent features on its website. Amazon also created "channels" to benefit certain causes. In 2004, Amazon's "Presidential Candidates" allowed customers to donate $5–200 to the campaigns of 2004 U.S. presidential hopefuls. Amazon has periodically reactivated a Red Cross donation channel after crises such as the 9/11, Hurricane Katrina, and the 2004 earthquake and tsunami in the Indian Ocean. By January 2005, nearly 200,000 people had donated over $15.7 million in the US.[70]

Amazon Web Services

Main article: Amazon Web Services

Amazon Web Services (AWS) was first launched as a public beta of Amazon Elastic Compute Cloud running Microsoft Windows Server and Microsoft SQL Server.[71] This was later expanded to several operating systems including various flavors of Linux and OpenSolaris.

In March 2006, Amazon launched an online storage service called Amazon Simple Storage Service (Amazon S3). An unlimited number of data objects, from 1 byte to 5 terabytes in size, can be stored in S3 and distributed via HTTP or BitTorrent. The service charges monthly fees for data stored and transferred. In 2006, Amazon introduced Amazon Simple Queue Service (Amazon SQS), a distributed queue messaging service, and product wikis (later folded into Amapedia) and discussion forums for certain products using guidelines that follow standard message board conventions. Also in 2006, Amazon introduced Amazon Elastic Compute Cloud (Amazon EC2), a virtual site farm, allowing users to use the Amazon infrastructure to run applications ranging from running simulations to web hosting. In 2008, Amazon improved the service adding Elastic Block Store (EBS), offering persistent storage for Amazon EC2 instances and Elastic IP addresses, static IP addresses designed for dynamic cloud computing. Amazon introduced SimpleDB, a database system, allowing users of its other infrastructure to utilize a high reliability high performance database system. Amazon continues to refine and add services to AWS, adding such services as Scalable DNS service (Amazon Route 53), payment handling, and AWS specific APIs for their Mechanical Turk service.

Amazon Prime

Amazon Prime offers free two day shipping with no minimum purchase amount for a flat annual fee, as well as discounted one day shipping rates.[72] Amazon launched the program in the continental United States in 2005, in Japan, the United Kingdom and Germany in 2007, and in France (as "Amazon Premium") in 2008. In February 2011, Amazon Prime membership was expanded to include access to instant streaming movies and TV shows at no additional cost. [73]

Amazon Publishing

Amazon Publishing is Amazon's publishing unit.[74] It is composed of AmazonEncore,[75] AmazonCrossing,[76] Montlake Romance,[77] Thomas & Mercer,[78] and Powered by Amazon. Additional imprints are planned.

In May 2009 Amazon launched AmazonEncore, the inaugural flagship general imprint.[79] AmazonCrossing was announced in May 2010,[80] for translated works into English. The first translated books were the French-language novel The King of Kahel and the German-language novel The Hangman's Daughter which were released in November and December 2010, respectively.[81]

In May 2011 Amazon launched two genre-focused imprints, Montlake Romance, and Thomas & Mercer. Montlake Romance is an imprint for the romance genre, "Romance is one of our biggest and fastest growing categories, particularly among Kindle customers," said Jeff Belle, vice president of Amazon Publishing.[82] Thomas & Mercer is for mystery titles.[83]

Powered by Amazon is a self-publishing platform that allows the publication of a series of books under any imprint name.[84] For example in May 2011 Seth Godin launched The Domino Project, an imprint created to publish a series of manifestos.[84] It was the inaugural Powered by Amazon imprint project.[84]

Subscribe & Save

Amazon's Subscribe & Save program offers a discounted price on an item (usually sold in bulk), free shipping on every Subscribe & Save shipment, automatic shipment of the item every one, two, three, or six months, with the option of canceling at any time.[85]

AmazonBasics

AmazonBasics is a private-label consumer electronics product line. It sells AV cables, blank DVD media and other electronics products under the AmazonBasics product label.[86] The line was launched in 2009.[87]

Other services

Launched in 2005, Amazon Shorts offers exclusive short stories and non-fiction pieces from best-selling authors for immediate download. By June 2007, the program had over 1,700 pieces and was adding about 50 new pieces per week. In November 2005, amazon.com began testing Amazon Mechanical Turk, an application programming interface (API) allowing programs to dispatch tasks to human processors.

In 2007 Amazon launched Amapedia, a now-defunct wiki for user-generated content to replace ProductWiki, the video on demand service Amazon Unbox, and Amazon MP3, which sells downloadable MP3s.[88] Amazon's terms of use agreements restrict use of the MP3s, but Amazon does not use DRM to enforce those terms.[89] Amazon MP3 sells music from the Big 4 record labels EMI, Universal, Warner Bros. Records, and Sony BMG, as well as independents. Prior to the launch of this service, Amazon made an investment in Amie Street, a music store with a variable pricing model based on demand.[90] Also in 2007 Amazon launched Amazon Vine, which allows reviewers free access to pre-release products from vendors in return for posting a review, as well as payment service specifically targeted at developers, Amazon FPS.[citation needed] In November 2007, Amazon launched Amazon Kindle, an e-book reader which downloads content over "Whispernet", via the Sprint Nextel EV-DO wireless network. The screen uses E Ink technology to reduce battery consumption to provide a more legible display. As of March, 2011, the stated library numbers over 850,000 titles. In December 2007, In August 2007, Amazon launched an invitation-only beta-test for online grocery delivery. It has since rolled out in several Seattle, Washington suburbs.

In January 2008 Amazon began rolling out their MP3 service to subsidiary websites worldwide.[91] In December, 2008, Amazon MP3 was made available in the UK. In September, IMDB and amazon.com launched a Music metadata browsing site with wiki-like user contribution.[92] In November, Amazon partnered with Fisher-Price, Mattel, Microsoft and Transcend to offer products with minimal packaging to reduce environmental impact and frustration with opening "clamshell" type packaging.[66] Amazon Connect enables authors to post remarks on their book pages to customers. Amazon Webstore allows businesses to create custom e-commerce websites using Amazon technology. Sellers pay a commission of 7 percent, including credit-card processing fees and fraud protection, and a subscription fee which ranges between free to $24.99/month depending on different bundle options for an unlimited number of webstores and listings.

In July 2010 Amazon announced that e-book sales for its Kindle reader outnumbered sales of hardcover books for the first time ever during the second quarter of 2010. Amazon claims that, during that period, 143 e-books were sold for every 100 hardcover books, including hardcovers for which there is no digital edition; and during late June and early July sales rose to 180 digital books for every 100 hardcovers.[93]

In 2011, Amazon announced that it was releasing a Mac download store in order to offer dozens of games and hundreds of pieces of software for Apple computers. [94]

Amazon.com exclusives

An Amazon.com exclusive is a product, usually a DVD, that is available exclusively on Amazon.com. Some DVDs are produced by the owner of the film/product, while others are produced by Amazon.com, itself. The DVDs produced by Amazon are made using their Createspace program, in which DVDs are created once ordered using DVD-R technology. The DVDs are then shipped about two days later after being produced. Some DVDs (such as the Jersey Shore Season 1 or The Unusuals Season 1) first release their DVD on Amazon as an Amazon.com Exclusive for a limited time before being released elsewhere. On May 23, 2011, Amazon.com allowed customers to download Lady Gaga's Born This Way album for $0.99, resulting in some downloads being delayed due to an extremely high volume of downloads. [95]

Website

The domain amazon.com attracted at least 615 million visitors annually by 2008, twice the number of walmart.com.[96] Amazon attracts approximately 65 million customers to its U.S. website per month.[97] The company has also invested heavily on a massive amount of server capacity for its website, especially to handle the excessive traffic during the December Christmas holiday season.[98] There are different versions of the website for different countries, such as amazon.co.uk, amazon.fr, amazon.de, amazon.it, amazon.at, amazon.jp, amazon.ca. These sites vary in assortment and prices.

Reviews

See also Amazon.com controversies#Amazon Reviews

Amazon allows users to submit reviews to the web page of each product. Reviewers must rate the product on a rating scale from one to five stars. As with most rating scales, one star stands for the product being abysmal, five stars meaning that the item is stellar. Amazon provides an optional badging option for reviewers which indicate the real name of the reviewer (based on confirmation of a credit card account) or which indicate that the reviewer is one of the top reviewers by popularity. Customers may comment or vote on the reviews, indicating whether or not they found it helpful.

Content search

"Search Inside the Book" is a feature which allows customers to search for keywords in the full text of many books in the catalog.[99][100] The feature started with 120,000 titles (or 33 million pages of text) on October 23, 2003.[101] There are currently about 300,000 books in the program. Amazon has cooperated with around 130 publishers to allow users to perform these searches.

To avoid copyright violations, amazon.com does not return the computer-readable text of the book. Instead, it returns a picture of the matching page, disables printing, and puts limits on the number of pages in a book a single user can access. Additionally, customers can purchase online access to some of the same books via the "Amazon Upgrade" program.

Third-party sellers

Amazon derives about 40 percent of its sales from affiliate marketing called "Amazon Associates" and third-party sellers who sell products on Amazon[citation needed]. Associates receive a commission for referring customers to Amazon by placing links on their websites to Amazon, if the referral results in a sale. Worldwide, Amazon has "over 900,000 members" in its affiliate programs.[102] Amazon reported over 1.3 million sellers sold products through Amazon's World Wide Web sites in 2007. Unlike eBay, Amazon sellers do not have to maintain separate payment accounts; all payments are handled by Amazon.

Associates can access the Amazon catalog directly on their websites by using the Amazon Web Services (AWS) XML service. A new affiliate product, aStore, allows Associates to embed a subset of Amazon products within, or linked to another website. In June 2010, Amazon Seller Product Suggestions was launched (rumored to be internally called "Project Genesis") to provide more transparency to sellers by recommending specific products to third party sellers to sell on Amazon. Products suggested are based on customers' browsing history.[103]

A January 2010 survey of third-party sellers by Auctionbytes.com [104] found that Amazon was 4th overall.[105] amazon.com placed second in "Profitability". Its lowest rating, but still above average, was in "Ease of Use". Sellers felt Amazon had clearly defined rules, provided a steady stream of traffic to their listings, and put less emphasis on a community component. amazon.com came in second in the Recommended Selling Venue category.

Amazon sales rank

The Amazon sales rank (ASR) provides an indication of the popularity of a product sold on any Amazon locale. It is a relative indicator of popularity that is updated on an hourly basis. Effectively it is a "best sellers list" for the millions of products stocked by Amazon.[106] While the ASR has no direct effect on the sales of a product, it is used by Amazon to determine which products to include in their best sellers lists.[106] Products that appear in these lists enjoy additional exposure on the Amazon website and this may lead to an increase in sales. In particular, products that experience large jumps (up or down) in their sales ranks may be included within Amazon's lists of "movers and shakers" and this also provides additional exposure that may lead to an increase in sales.[107] For competitive reasons, Amazon does not release actual sales figures to the public. Amazon, however, has now begun to release point of sales data via the Nielsen BookScan service to verified authors. [108] While the ASR has been the source of much speculation by publishers, manufacturers and marketers, Amazon themselves do not release the details of their sales rank calculation algorithm. In addition, they state:

Please keep in mind that our sales rank figures are simply meant to be a guide of general interest for the customer and not definitive sales information for publishers - we assume you have this information regularly from your distribution sources

Controversies

Main article: Amazon.com controversies

Since its founding, in summary, the website Amazon.com has attracted criticism and controversy from multiple sources over its actions, such as its "1-Click patent" claims, anti-competitive actions, price discrimination, anti-unionization efforts, Amazon Kindle remote content removal, taking public subsidies and avoiding sales tax collection duties. Various decisions over whether to censor or publish content such as the WikiLeaks web site; LGBT book sales rank; and works containing libel, facilitating dogfight, cockfight, or pedophile activities have been controversial.

Sales and use taxes

Main article: Amazon tax

Amazon collects sales tax from just five states. Amazon is under increasing legal and political pressure from state governments, traditional retailers and other groups because of its refusal to collect sales tax in 40 of the 45 states with a statewide sales tax (as of May, 2011). Those 40 states include at least 12 where Amazon has a clear physical presence[109] via distribution centers and wholly owned subsidiaries. Critics of Amazon argue that its refusal to collect sales taxes has given it an unfair advantage over traditional retailers. While customers are required to remit use tax directly to their state, few customers do so.

Amazon says it would support a federal solution to the sales tax problem as long as such legislation was fair and simple. As of May 2011 legislation has been introduced in Congress to allow states to impose sales taxes on sales to their residents from out of state. Amazon has not expressed a public position on the bill. Amazon's competitors say it is insincere. Similar legislation, called the Main Street Fairness Act, failed in committee in 2010. Several earlier versions of the bill also failed to advance. Amazon lobbyists met four times with members of Congress or their aides in 2010 regarding the Main Street Fairness Act. The company spent $610,000 on lobbying in 2010, although these expenses also covered other bills discussed at the same time. Amazon has increased political contributions to federal lawmakers. Amazon's political action committee spent $214,000 during the 2010 election cycle, double what it spent for the 2008 elections. [110]

Lobbying

Amazon.com lobbies the federal government and state governments on issues such as the enforcement of sales taxes on online sales, transportation safety, privacy and data protection, and intellectual property. According to regulatory filings Amazon.com focuses its lobbying on the US Congress, the Federal Communications Commission, and the Federal Reserve. Amazon.com spent $450,000 on lobbying during the second quarter of 2011, $630,000 in the first quarter of 2011, and $500,000 during the second quarter of 2010. [111]

Entrepreneurship by former employees

A number of companies have been started and founded by former Amazon.com employees.[112]

See also

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