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/ / ‘Amazon Unbound’ is a portrait of a company ‘getting perilously close to invincible’

‘Amazon Unbound’ is a portrait of a company ‘getting perilously close to invincible’

“Amazon Unbound,” out Tuesday from Simon & Schuster, is the follow-up to journalist Brad Stone’s 2013 book, “The Everything Store.” (GeekWire File Photo / Kevin Lisota)

“I wonder what unit profitability was in 2017 without advertising?”

That seemingly mundane question, posed by Jeff Bezos during a meeting of Amazon’s senior leadership team, won’t get as much attention as other details from business journalist Brad Stone’s new book, “Amazon Unbound” — especially not when compared to revelations about the billionaire’s relationship with a helicopter pilot, and his ensuing battle with a supermarket tabloid.

However, the story illustrates a key takeaway from the book: Even as he pursues far-flung interests and prepares to step down as CEO, Bezos remains Amazon’s master architect, able to reshape entire businesses with a single question.

Looking at the numbers, Bezos recognized that an increase in Amazon’s advertising revenue was masking problems in its core e-commerce business. As Stone writes, this led senior leaders on Amazon’s “S-team” to scramble to find the answer, ultimately confirming that e-commerce unit profitability was declining.

This caused a fundamental change in Amazon’s approach, leading to cutbacks and a renewed focus on profitability that ultimately helped to boost the company’s stock price and market value, now hovering at more than $1.6 trillion.

“This moment reflects a fundamental truth to the Bezos method of business-building,” Stone explains on GeekWire’s Day 2 podcast. “He’s willing to make these long-term bets, to plant these seeds, to wait them out for seven or 10 years. But when they get that old, he wants them to produce on their own.”

This story runs counter to the popular theory that Amazon is willing to use profits from one part of its business subsidize money-losing businesses in perpetuity. In that way, it could provide fodder for Amazon in antitrust battles.

On the other hand, Stone concludes, Amazon’s ability to overcome its missteps shows it’s “getting perilously close to invincible.”

That’s what he writes after detailing Amazon’s search for a second headquarters, or HQ2. Stone uses diligent reporting and inside sources to shed new light on that process, the creation of Alexa, the changing sentiments of third-party sellers, Amazon’s last-mile delivery initiatives, its response to the pandemic, Bezos’ Blue Origin space venture, and many other topics.

Ultimately, the book asks, “Is the world better off with Amazon in it?” 

“Amazon Unbound: Jeff Bezos and the Invention of a Global Empire” is the follow-up to Stone’s 2013 bestseller, “The Everything Store.”

Toward the end of our podcast conversation, we discussed Bezos’ successor as CEO, and I asked if Amazon’s “Andy Jassy era” will be worthy of Stone’s third Amazon book. But he wasn’t sold on the premise of the question.

“Is it the Andy Jassy era? We will see, because Jeff is becoming executive chairman. He’s talking about staying around to continue to invent. When there’s an S-team meeting that Jeff is in, does Andy speak last, or does Jeff speak last? Does Andy stand up and leave the room as everyone sits in solemn silence, or does Jeff?”

“We don’t quite know,” Stone explained. “I think Andy’s going to be doing a lot of the stuff that’s not fun, but I really do wonder how far Jeff will go.”

Listen above, and subscribe to GeekWire’s Day 2 podcast for more.

“I wonder what unit profitability was in 2017 without advertising?” That seemingly mundane question, posed by Jeff Bezos during a meeting of Amazon’s senior leadership team, won’t get as much attention as other details from business journalist Brad Stone’s new book, “Amazon Unbound” — especially not when compared to revelations about the billionaire’s relationship with a helicopter pilot, and his ensuing battle with a supermarket tabloid. However, the story illustrates a key takeaway from the book: Even as he pursues far-flung interests and prepares to step down as CEO, Bezos remains Amazon’s master architect, able to reshape entire businesses with… Read MoreAmazon, Day 2, Advertising, Alexa, Brad Stone, Jeff Bezos

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